Any delay in the introduction of Value Added Tax (VAT) in the Turks and Caicos Islands would require a change in legislation and the Governor will have the final say.
This was stated in the House of Commons on November 19th by Britain’s Minister for Overseas Territories Mark Simmonds who was asked if he will allow the Government of the Turks and Caicos Islands to delay the introduction of VAT if it wishes to do so.
Simmonds replied: “The Interim Government in Turks and Caicos Islands decided to introduce VAT. Consequently the VAT Bill was signed into law on 18 July 2012 and will come into force on 1 April 2013. Any delay would require a change in legislation. Before giving assent to such legislation, the Governor would need to consider if it was consistent with the Constitution and the Statement of Governance Principles in force. This requires the new Turks and Caicos Islands Government to formulate and conduct macro-economic and fiscal policy for the sustained long-term prosperity of the people of the islands, and to manage public funds according to established principles of value for money, affordability and regularity and in the interests of long-term financial stability.”
Earlier this month, Simmonds told the House of Commons that “the introduction of value added tax is a decision for the Turks and Caicos Islands Government”.
Both the Progressive National Party (PNP) and the People’s Democratic Movement (PDM) have expressed their opposition to VAT.
Even if the two parties were to join forces in the House of Assembly and seek to repeal the VAT Bill, the Governor still has reserve powers under the Constitution that can over-ride that decision.
Section 72 of the Constitution states:
(1) If the Governor considers that the enactment of legislation is necessary or desirable-
(a) for the purpose of securing compliance with an international obligation;
(b) to ensure compliance with the Statement of Governance Principles for the time being in effect;
(c) to ensure that sufficient funds have been appropriated, within four months of the commencement of each financial year, for the effective operation of committees of the House of Assembly, the courts, the Attorney General’s Chambers, and each institution protecting good governance; or
(d) to give effect, with or without modifications, to the recommendations contained in a report of an Electoral District Boundary Commission, but, after consultation with the Premier, it appears to the Governor that the Cabinet is unwilling to support the introduction into the House of Assembly of a bill for the purpose or that the House is unlikely to pass a bill introduced into it for the purpose, the Governor may, with the prior approval of a Secretary of State, cause a bill for the purpose to be published in the Gazette and may (notwithstanding that the bill has not been passed by the House) assent to it on behalf of Her Majesty; but the bill shall be so published for at least 21 days prior to assent unless the Governor certifies by writing under his or her hand that the matter is too urgent to permit such delay in the giving of assent and so informs a Secretary of State.
(2) If any member of the Cabinet so desires, he or she may, within 30 days of the publication of a bill under subsection (1), submit to the Governor a statement in writing of his or her comments on such publication, and the Governor shall forward such statement, or a copy of it, as soon as practicable to a Secretary of State.”
Meantime, Simmonds, who will be in the Turks and Caicos Islands for the official opening of Parliament later this week, told the House of Commons that a framework document has also been agreed that sets out the key principles of good financial management and the debt threshold targets agreed by the Secretary of State for Foreign and Commonwealth Affairs, William Hague.
Within this framework, Simmonds added, the new Government will need to agree a medium-term strategic plan that includes revenue and expenditure forecasts for at least the next three financial years.
“It is important that TCI demonstrates its ability to run a credible and sustainable fiscal policy, including reducing its debt levels, so that it can refinance itself independently by the time the UK Government debt guarantee expires at the end of 2015-16. UK agreement to the budget and fiscal plans will be contingent on TCIG formulating credible policies to meet these key objectives,” Simmonds added.
Source-TCI SUN
