Hon. Mark Brantley

Opposition Leader Hon. Mark Brantley and Chamber of Industry and Commerce President Michael Morton have expressed concerns over the government's Nov 1 scheduled implementation of a Value Added Tax.

The announcement of VAT first came in the March 10 Throne Speech delivered by Governor General Sir Cuthbert Sebastian and the implementation date was revealed in Tuesday's Budget Address.

Brantley said VAT was the government's remedy for its own fiscal irresponsibility and the decision to implement the new tax system was arrived at without any public consultation.

"I am unhappy that I heard in the Throne Speech for the first time that VAT dropping in November. I never hear so before. We are aware that tax officials from both St. Kitts and Nevis have been working together on this over the past year but neither the government in St. Kitts nor that in Nevis has bothered to tell the citizens and residents of our country any details of the VAT scheme.

"We are now learning that the decision to implement VAT has already been taken and the only consultation to take place now with the general public is to educate us as to the implications of VAT. Let me make it clear that at no point was the public engaged in discussions as to whether VAT was the best way to go."

He said the broad based tax levied on goods and services consumed was being touted as a "savior to rescue the Federation from certain fiscal peril", yet no mention was made of VAT during political campaigns for the recently concluded general elections. Brantley also said that Prime Minister Hon. Dr. Denzil Douglas had surreptitiously avoided revealing the proposed VAT rate.

"The Prime Minister and Minister of Finance yesterday studiously avoided the rate at which VAT will be levied and while he claims it will be a great thing for the country by replacing some ten other taxes it must be a matter of concern to us all that not a single word was said about VAT in the recently concluded general elections.

"So we should ask ourselves as a nation, if VAT is such a good thing, how come nobody campaign on it? Not a word was said of VAT but 2 months later we are told VAT will come and by November VAT will be in place. But I wish to sound a note of caution. VAT may not necessarily be a panacea for the economic ills we face and may well retard the economic activity further unless sensibly and prudently implemented," he warned.

He opined that it may be that "we are trying to close the barn door after the horse has bolted" and VAT should not be implemented simply because other countries had done so.

"It is no answer that everybody in the Caribbean and OECS is doing it. I would like to know that we in St. Kitts and Nevis apply the intellectual capacity we have here to the problems that we face. Some critics consider VAT to be regressive tax, meaning that the poor pay more."

President of the Chamber of Industry and Commerce, Michael Morton also voiced his concern over the brief 'education' period leading up the November implementation of VAT. He was also apprehensive that the date if effect was mere weeks away from the business community's peak sales period.

"The period for educating all stakeholders, in particular consumers and of course the business community, the window of opportunity to my mind is very, very short and this is matter which will have to be addressed with the authorities. If you are talking about going to the House with legislation by May it means that we have just about 6 weeks to make an input in terms of the legislation.

"November is the time when most retail businesses are focusing on their sales for Christmas and doing their marketing in preparation for a good year end. Therefore the implementation of VAT in November to my mind is going to be a major deterrent to the normal focus which is moving your inventory at that time and selling out your goods."

Honorable Richard Skerritt challenged Brantley's claim that VAT was "coming like a thief in the night" saying VAT had been mentioned in the Budget Addresses of the two previous years and that stakeholders were getting at least 7 months notice before the tax was at their doorstep.