Customs Service Charge exemption ends in 2011

Delivering his 2011 Budget Address in the National Assembly on Tuesday, Dr. Douglas – Minister of Finance – disclosed that a study carried out by a CARTAC Consultant has determined that the level of exemptions which are currently being granted cannot be sustained.

Dr. Douglas said the amount of Customs Service Charge (CSC) exempted in 2009 was $19.6 million.

“All Customs Service Charge exemptions will come to an end in 2011.  It means therefore that discretionary concessions will be limited to Import Duty only as the Value Added Tax (VAT), by its structure does not allow discretionary concessions. Discretionary concessions will therefore be limited to Import Duty only and in some cases the concessions on vehicles in particular will be limited to 50% or 75% of the Import Duty,” Dr. Douglas told the National Assembly.


He said too that the Ministry of Tourism and International Transport and the St. Christopher Air and Sea Ports Authority (SCASPA) with the Ministry of Finance will work to have all taxes on air travel collected by the International Air Transport Association (IATA) and it is anticipated that this will centralize the collection and monitoring of this group of taxes and eliminate leakages.

A slight adjustment in the Housing and Social Development Levy was also announced and will be implemented in 2011.

Currently, the structure of the Housing and Social Development Levy includes the following four tiers. Tier one consists of annual income up to $13,000 per annum. The employer contributes 3% of income and the employee falling within this tier does not contribute.

Tier two is made up of annual incomes ranging from $13,000 to $78,000.  The employer pays 3% of income and the employee in this tier pays 3%.

Tier three is made up of annual incomes ranging from $78,000 to $96,000. The employer contributes 3% and the employees in this tier pay 8% and Tier four is made up of annual incomes over $96,000 in which the employer pays 3% and the employee contributes 10%.

“In the proposed measure the tiers will remain the same. Employers will continue to contribute 3% for each tier and tier one employees will continue to be exempted from the Levy.  However, Tier two employees will contribute 3.5% instead of 3%, Tier three employees 10% instead of 8% and Tier four employees 12% instead of 10%.  The legislative amendment necessary to effect this new measure will be passed early in the New Year,” said the Minister of Finance.


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