In a radio programme on Tuesday, (26th October), Prime Minister and Minister of Finance, Dr. Denzil Douglas, assured listeners that the introduction of the Value Added Tax, (VAT), will in fact not be halted and will commence as planned from 1st November. His statement was however, a direct response to local businesses that are signalling that they are not ready.
The Prime Minister was reacting to recent comments made in a press conference on Monday, 25th October, hosted by the leading private sector organization, the Chamber of Industry & Commerce, (CIC).
Dr. Douglas said that the Chamber of Commerce should have seen the importance to give the government advanced notice of its desire to brief the media. He said that we can’t have a conversation through the media and it would have been better for the Chamber to seek discussions with the Ministry of Finance, if there were concerns that they wished to discuss.
The St. Kitts & Nevis leader said, what was said at the CIC’s press conference was disappointing. He said that the Chamber seems to have moved from a state of readiness to not being ready. Dr. Douglas said that he was told, as recent as Saturday, (23rd October), by some local businessmen that they were ready for the VAT, so he is now confused by the new position being adopted by the private sector body.
Prime Minister Douglas admitted that his VAT office may not have all the answers and that the new system may not be perfect but even in some countries where VAT was previously introduced, those nations had many difficulties. Even one country had to introduce the VAT twice, and even then, there were still problems, said the Prime Minister.
As the Prime Minister continued the defence of this new tax system, he urged that people should put aside their partisan political interests and seek to address the issues at hand, in a responsible manner. He said that those who lead the Chamber of Industry & Commerce are expected to demonstrate maturity, because the CIC is a matured organization.
Dr. Douglas said that his government has had good working relations with the Chamber over the years, and it is his hope that these good relations will continue.
He stated that it was only last week that his Cabinet examined the Basket of Goods, with items that are most needed by the poor and vulnerable in society .He said that Cabinet took the decision to reduce and remove the Duty, payable on some of these items, especially those that previously did not have a requirement for the payment of Consumption Tax.
Government wants to ensure that there is a balance on these items, in terms of the prices to be charged, stated Douglas. He also shared that Cabinet has added new food items to the Basket of Goods. Douglas said that with the introduction of VAT, “Some goods will go up and some will go down”.
“VAT is no miracle tax. It is a fairer tax. It is a good tax”, said the Prime Minister in the closing moments of his weekly radio programme, Ask the PM.