AMCHAM T&T’S RESPONSE TO THE 2017-2018 NATIONAL BUDGET
AMCHAM T&T listened with interest to the National Budget 2017/2018 presentation by the Honourable Minister of Finance. We expected this presentation to result in some difficult measures being announced. We appreciate therefore that the Government has some hard decisions to make and has limited options. We are concerned that the Minister focused too heavily on revenue increases through greater taxation of those who are already compliant, and filling the revenue gap through the one off sale of CL Financial assets. Overtaxing of the formal economy is going to have a dampening effect on reinvestment.
We feel the presentation fell short on explaining measures to expand tax collection into the informal and underground economies. In spite of a desire to bring the gaming industry into the tax net to a greater extent, simply increasing taxes while admitting that tax collection in the sector is weak, is unlikely to work.
Most worrying is the potential negative impact on investment of the additional taxes on the upstream energy sector, most significant of which will be the proposed Supplemental Petroleum Tax on gas. We hope that this will only be done after consultation with the industry. In addition, the apparent concentration of additional discretionary power in the Cabinet in terms of the small business grants and housing projects should be carefully considered as it is not in keeping with best practice regarding to transparency.
The commitment to transform the public service and take the hard decisions in this regard was welcomed but we have heard such promises in the past. We now await the specifics.
We do support the establishment of the Revenue Authority which would combine both the BIR and the Customs Department. The implementation of this requires deep and meaningful engagement with all stakeholders. We support the establishment of the semi-autonomous Board to oversee the establishment of this Authority and we urge the inclusion of the Customs functions in the TTBiz Link Platform.
We appreciate the re-commitment to the establishment of the Procurement Regulator and encourage the Government to keep to its commitment in this regard, the most important function of which would be to provide the necessary resources and funding.
We are pleased that the Minister made good on his commitment to adjust the margins for fuel peddlers and dealers and encourage regular reviews since this is a fixed price industry. The increased incentives to the Tourism sector can be useful to stimulate activity in this sector and we encourage even greater policy co-ordination and execution to achieve the stated policy results.
Incentives for the tourism sector seemed to be concentrated on room stock and, while important, other key stakeholders need to be considered in any incentive scheme: tour operators, car rental companies, entertainment etc. These actors are a key component of the tourism industry and we should examine how incentives can be provided to these entities as well.
We will expand on this statement at our Post Budget Analysis Event on Wednesday 4th October at the Trinidad Hilton at which Minister Allyson West will deliver the Feature Address and focus on tax-related matters including the establishment of the Revenue Authority.
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