The Tribune

By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

PRIME Minister Perry Christie said yesterday he was hopeful that economic growth would enable him to rely less on Value-Added Tax (VAT) to fill the “untenable imbalance” in the Government’s finances.

Speaking after his 2013/2014 Mid-Year Budget statement, Mr Christie said: “There is real comfort on the horizon in terms of opportunities for us to get people working. We are working very hard at that.

“It is my hope and belief that if I could successfully bring about a resurgence in the economy, I then don’t have to put that great of a reliance on raising all the money from VAT.”

The Government is expecting to raise an extra $200 million in annual revenues from VAT, and $500 million gross, with the $300 million balance replacing foregone Customs duties.

Mr Christie said the Government currently has in place all that is necessary to implement VAT on its targeted July 1 date.

“The question for the Government will be: ‘Are you ready for the implementation of VAT’? In the meantime, however, there has been a ranging discussion in the private sector about whether or not that is the appropriate tax, and whether or not 15 per cent is the appropriate rate” said Mr Christie.

“In that regard, the private sector has argued in some areas for a payroll tax, and we have had a number of persons speak to the significance of coming in at a rate lower than the 15 per cent established by the Ministry of Finance.”

He added that in Monday’s meeting with the Coalition for Responsible Taxation, he agreed to provide the group with whatever information they required for their consultants to review the Government’s position on the need for additional revenue and suggest an alternative form of taxation for the country.

“In the circumstances as Prime Minister, I am giving the people who are out there with a point of view an opportunity to have a report done for them that will result in them being able to say to me this is what we believe,” said Mr Christie, who noted that the Government had retained an American consultancy firm that was preparing a final report of its own on the issue..

Mr Christie said that despite the Government’s advanced stage of preparation toward VAT, he was still prepared to listen to the private sector.

“Given the fact that we are at an advanced state in our preparation, as a government I am still prepared to listen. In this case I’m prepared for you to go ahead and do a final report,” he added.

“I’m doing one and we will sit and discuss it with them, and then we will make a decision on moving ahead. I have indicated the same to my colleagues.”
 Mr Christie said the “last thing in the world” he wanted to do was to get into a media war with the private sector over the taxation issue.