The Governor’s Office said tonight that preparations for the introduction of Value Added Tax were continuing at full speed in line with British Foreign Office Minister Mark Simmonds’ letter to the Premier, the Honorable Dr Rufus Ewing, on 14th January. The plan was to put VAT into effect on 1st April, while UK Ministers awaited a proposal for a credible alternative to VAT in the Turks and Caicos Islands. Some of the key elements of this VAT implementation program were spelt out by the Governor’s Office. The first element of this final lap is the setting up of a new Revenue Department under the former Belize under-secretary Cynthia Costillo. She takes up post as Commissioner of Revenue on the 18th of February. This brings together the people who previously worked in the Revenue Control and VAT implementation units. Here’s Chris Jarrett.
“ The members of the VAT team have been receiving training from the Caribbean Regional Technical Assistance Center (CARTAC) on VAT Fundamentals and VAT Legislation Training since December last year. They are about to begin a visit program to the 500 VAT registered firms: 130 businesses have already received their packs in this regard; 41 compliance visits have already taken place with a further 18 already scheduled to take place in January. The team will visit all registered businesses in good time for implementation on 1st April. The TCI Government signed a $500,000 contract with Sogema on 17th of January for a new software system to help implement and monitor VAT. Hugh McGarel-Groves, Chief Financial Officer of the TCI Government said VAT was internationally recognized as a good tax both for Government revenues and for the economy. The CFO said it was straightforward to collect, broadly based and improved cash flow by being paid more regularly than other forms of tax. He added that given the improving but still weak state of the country’s finances, VAT had been signed into law in 2012 to finally allow the TCI to begin to benefit from VAT after many years of discussion. UK ministers were confident VAT was an important tool in further securing the TCI public finances. However – as politicians themselves – they recognized the democratic mandate of those elected here. They awaited proposals for credible alternatives.” This is Chris Jarrett for RTC
Still on this VAT statement, Mr McGarel Groves went on to say that the obligations of Government could not wait – there were investments, bills and salaries to be paid month in and month out. The new financial year would begin in only a few weeks. That was why UK Ministers believed that the TCI should proceed with Value Added Tax now – to protect Government revenues and through them public spending levels – and to review it again at the end of the next financial year. This would also allow local political leaders even more time to further develop credible alternatives, he added.
