Barbados deficit has increased to unsustainable levels, says finance minister

Sinkler said that the government’s fiscal adjustment programme, which he announced during this year’s financial statement and budgetary proposals, will be implemented in full.

The minister said: “There are no excuses, there will be no excuses, and there are no methods for us to escape the implementation of that programme… The fiscal adjustment programme is in place and will be implemented in full because, frankly ladies and gentlemen, we don’t have a choice; we have to do it and that adjustment has to be made.”

During a wide-ranging address, he spoke about a number of the budgetary proposals that received negative publicity. Sinckler told his audience that he would soon be taking legislation to Parliament governing the Consolidation Tax, which would expire on March 31, 2015.

He added that legislation on the Municipal Solid Waste Tax would be taken to Parliament, even though the tax would not come on stream until 2015. 

“Therefore, it is not true to say, as some people have been saying, that the Commissioner of Land Tax will be trying to collect tax without the appropriate legislation… We will do the legislation anyway in 2014, but it will not be applicable until 2015…

“The Municipal Solid Waste Tax is not a land tax and is not expected to perform as a land tax. So, therefore, it is erroneous and foolhardy of anybody to look at the traditional land tax, transpose that as a municipal tax and try to come up with a figure. 

“Cabinet on Thursday of this week will approve the Bill to be drafted; it is a very simple Bill and details of the contents of that Bill will be shared prior to its laying and debate in Parliament. There will be no lack of clarity in regards to that.”

Sinckler said people had questioned why government was introducing a municipal tax since Barbados had no municipalities, but he explained that the term municipal waste referred to traditional household and commercial trash. 

With reference to direct tourism services, the minister disclosed that he would be meeting with the Barbados Private Sector Association, the Barbados Chamber of Commerce and the Barbados Hotel and Tourism Association, in an effort to “clearly outline government’s position on direct tourism services”.

He noted that the ministry of finance had asked the ministry of tourism and the Barbados Tourism Authority for a definition of direct tourism services, but the industry players had suggested that the list was too restrictive. He said his ministry had accepted that intervention and asked the relevant teams to come up with an appropriate list. 

“Both Minister Sealy and myself consulted on the matter and the appropriate Cabinet paper was prepared and will be approved in a day’s time; and that will be the end of that,” he stressed.

Speaking about government’s expenditure adjustments, Sinckler pointed out that, during the first week of October, the prime minister held a meeting, which he attended, along with permanent secretaries and heads of departments. 

“We reviewed where the cuts will be made, how they will be done and I am happy to report that we are 80 to 90 percent where we need to be. There are some ministries which will have challenges and we are working with those and there are some specialised departments which will have challenges and we are working with those. But as the prime minister has said, our goal is well insight and, therefore, we expect full implementation of those adjustments.

“Some ministries were able to come back with more than we asked for, others slightly under, and some bang… And, we believe with a concerted effort over the next few weeks and with full implementation during 2014 all targets will be achieved,” he stressed.

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