Good Afternoon,Mr. Speaker, I would like to start with a verse from Galatians chapter 6, verse 10 that states that:
“So then, while we have opportunity, let us do good to all people…”
Mr. Speaker, this is what our Government has been doing since Day 1 in office, and it gives me great pleasure to be able to speak to the hard work of our good government, specifically through the accomplishments of the Ministry of Finance – in particular the accomplishments over the last couple of weeks.
TAXATION: COUNCIL REVIEWS LIST OF NON-COOPERATIVE COUNTRIES FOR TAX PURPOSES
Mr. Speaker, the EU has a program to address what they deem as “harmful tax practices” by countries. The EU aim is to have countries comply with a set of “objective tax good governance criteria, which include tax transparency, fair taxation and implementation of international standards designed to prevent tax base erosion and profit shifting.” Mr. Speaker, on the 24 February 2022, the European Council ruled on the revised EU list of Non-Cooperative jurisdictions for tax purposes. Countries on the list are described as encouraging “…abusive tax practices, which erode [EU] member states’ corporate tax revenues”. What happens when a country is on put on the list of Non-Cooperative jurisdictions Mr. Speaker? Well according to the European Council website, its member states “will act together to put pressure for reform”. Mr. Speaker, as I am sure you’re aware, this is one of those rare times when the bite is greater than the bark. I’ve been told that it’s really not in a country’s best to end up on that list.
Mr. Speaker, the EU list of non-cooperative jurisdictions for tax purposes adopted by the Council on 24 February 2022 includes:
• American Samoa
• Fiji
• Guam
• Palau
• Panama
• Samoa
• Trinidad and Tobago
• US Virgin Islands
• Vanuatu
Mr. Speaker, as the guardian of the financial services sector, I am pleased to say to the people of the Turks & Caicos Islands, especially those who work in financial services, that one country that is not on the list is the Turks & Caicos Islands. Mr. Speaker, jurisdictions that do not yet comply with all the EU international tax standards, but have committed to reform, are included in a state of play document (Annex II). This is the list that the Turks & Caicos Islands is currently on, and I’m happy to say that once a jurisdiction meets all its commitments, it is removed from the annexes, and this is what we’re aiming to achieve.
I want to take this time to congratulate the Ministry of Finance team, particularly Mr. Henry Saunders, Director, Financial Transactions Information Exchange, and his team; and the PS of Finance, Mrs. Athenee Harvey-Basden and her team; who worked very hard to ensure that we met the requirements to be included on Annex II, and who are working very hard for our jurisdiction to be removed from the Annexes altogether.
TCI FINANCE LIMITED
Mr. Speaker, sticking with finance sector, in late January 2018, the then Government undertook a strategic analysis of the TCI’s financial services sector, believing that the TCI has a fair opportunity for growth in this sector. The consultancy was conducted by KPMG Ltd.
Mr. Speaker. KPMG’s report indicated that our financial services sector is in dire straits, and that it is in need of investments and promotion to save it – i.e. if we want it to be a viable contributor to the country’s GDP going forward. Forty-nine (49) recommendations are included in the report, one of which was to develop and implement a marketing strategy for the sector.
Mr. Speaker, I am happy to say that on the 16 February 2022, Cabinet approved the signing of a Memorandum of Understanding between the Government and TCI Finance Limited to implement the aforementioned Marketing and Strategic plan in order to grow our Financial Services industry. Mr. Speaker, our Government is “priming the pump” of our financial service sector, and we’re seeking to aggressively grow our market share.
INVEST TCI MSME GRANT PROGRAMME
Mr. Speaker, turning my attention now to Invest TCI, specifically the MSME Grant Programme. While there are numerous examples of Concession Orders being granted to support start-up businesses, I would like to speak to Our Government, Your Government, the People’s Government’s performance in this area over the current financial year (i.e. 1st April 2021 to current) – comparing it to the last four years, as well as, to the previous Government’s first year in office.
Mr. Speaker, for the four years between FY2017/2018 – FY2020/21, there were an average of 17 Concession orders issued per year, with an average of $455,000 paid out per year. Mr. Speaker, so far over our first full financial year in office, which isn’t even over yet, we have issued 36 Concession orders, which is an increase of 118% over previous years, and we paid out over $694,000, which is an increase of over 50% over the previous years.
Mr. Speaker, in its first year in office, the previous Government issued 12 Concession orders for a total of $360,000. When that is compared with our Government’s first year total of 36 Concession orders and $694,000 in grants, I’m proud to say that we have empowered 200% more entrepreneurs in our first year than the previous Government did, and we gave out almost double the amount of money in grants.
Mr. Speaker, that’s just the start!!! BIG THINGS ARE COMING for our entrepreneurs in years 2, 3, and 4 of this term, as well as in our consecutive terms 2, 3, 4, and more. As long as we’re in Government Mr. Speaker, we will look out for our entrepreneurs.
Mr. Speaker, I am pleased to inform the people of the Turks & Caicos Islands that the Invest TCI’s MSME Programme will be hosting the MSME Roadshow 2022. The purpose of the MSME Roadshow 2022 is to educate the public on the opportunities available to entrepreneurs and small businesses through the MSME Programme. It will highlight the success of the MSME Programme and bring awareness to the small businesses who have benefitted from it. I am encouraging all persons, especially businesspersons and entrepreneurs, to come out and be a part of it.
DEPARTMENT OF TRADE, INDUSTRY, AND FAIR COMPETITION
Mr. Speaker, during March 7-8, 2022, the Department of Trade, Industry, and Fair Competition, in partnership with the Jamaica Promotions Corporation (JAMPRO), hosted a free Virtual Trade Mission (VTM) aimed at connecting buyers, importers, agents, and distributors from the Turks and Caicos Islands with exporters from Jamaica. The main objectives of the VTM included:
1. Enhancing trade cooperation between the TCI and Jamaica;
2. Assisting with the diversification of the TCI’s trade partners;
3. Assisting participating companies to gain market insights, make industry contacts, solidify business strategies, and advance specific projects, with the goal of sourcing/increasing cheaper import alternatives into the TCI;
4. Increasing awareness of export ready Jamaican product offerings to buyers in the TCI;
5. Improving business relationships between buyers and suppliers in the TCI and Jamaica, respectively; and
6. Fostering business transactions by providing a meeting platform for scheduled business interactions.
Mr. Speaker, the VTM featured country and market/sector briefings and one-on-one virtual B2B meetings between pre-screened exporters from Jamaica and potential buyers, importers, agents, and distributors from the Turks and Caicos Islands.
The VTM was open to all companies and umbrella organization groups in the TCI with an interest in sourcing the following products from Jamaica:
• fresh agricultural produce;
• salty and sweet snacks;
• herbs,
• spices and sauces;
• gluten-free flour;
• beverages;
• tinned food;
• beauty and personal care items;
• paper products;
• chemical and cleaning products; and
• building materials.
Mr. Speaker, over the course of the Mission, 20 of our Importers (which came from all across the TCI, including Providenciales, Grand Turk, North Caicos, and South Caicos) met with 36 Jamaican Exporters, with them having 89 B2B meetings. On average, each one of our Importers met with 5 Jamaican Exporters.
Mr. Speaker, achieving food security is important to Our Government, and this initiative by the Department of Trade, Industry, and Fair Competition is a step in that direction. Look for other similar initiatives by this dynamic department.
MINISTRY OF FINANCE
Mr. Speaker, on the 16th February 2022, Cabinet approved amendments to the First Time Home Owner’s Policy, aimed at assisting in promoting homeownership for Turks & Caicos Islands Status Holders and BOTCs, with commencement set for the 1st April 2022.
Mr. Speaker, our Government’s First Time Home Owner’s Policy allows first time property buyers, and persons renovating their homes after 10 years, to receive $50,000 in Stamp Duty and Import Duty concessions.
Now Mr. Speaker, this policy was first rolled out in 2019 by the then Government of the day, and unfortunately, but not surprisingly, it had a low uptake. Specifically, Mr. Speaker, during the period April 2019 to January 2022, the Ministry of Finance received approximately 100 applications, with 80 being approved for concessions totaling $570,000. The breakdown of the concessions awarded are:
• 31 Stamp Duty Waivers for a total of $441,035, and
• 49 Import Duty Waivers for a total of $129,897.
Mr. Speaker, the previous Government had this policy in place for 34 months, and during that time less than 3 persons per month benefitted from it, with the average payout being approximately $17,000.
Mr. Speaker, our enhancements remove many, if not all, of the nuisances and obstacles that made the old policy unattractive. In addition to increasing the concession amount from $20,000 to $50,000, our Government also:
1. Allows concessions to be applied to both Stamp Duty and Import Duties rather than one or the other, and
2. Removed the restrictions limiting concessions to land purchases of $150,000 or less, and land + building purchases of $500,000 or less.
Mr. Speaker, imagine that. The old policy actually had restrictions that limited the concessions to land purchases of $150,000 or less, and land + building purchases of $500,000 or less. Mr. Speaker, as the previous Government crafted and/or signed off on this policy, this is tantamount to them intentionally punishing Turks & Caicos Islanders for wanting to own nice property. Mr. Speaker, the old policy basically said to Turks & Caicos Islanders (particularly Turks & Caicos Islanders) that if they could afford to buy land worth more than $150,000 or land + a building worth more than $500,000, that the Government didn’t think that they deserved the concession.
Mr. Speaker, our Government want Turks & Caicos Islanders to Live Best Lives, and that’s why we took a Red Pen to First Time Home Owner’s Policy. When we got to the restrictions that punished our people for wanting to own nice property, we told the Technocrats to “take it out!!!”. As a matter of fact, Mr. Speaker, I didn’t even wait for them to do it, I took it out myself.
Mr. Speaker, our desire to empower Turks & Caicos Islanders through property ownership didn’t stop at the First Time Home Owner’s Policy. We went further Mr. Speaker. Our Government also increased the Zero-Rated transactions under the Stamp Duty Ordinance from $25,000.00 to $100,000.00 for Turks & Caicos Islanders. Going forward, Turks & Caicos Islanders who purchase property worth $100,000.00 or less will pay zero (0) Stamp Duty. And those who purchase property for greater than that amount on: the islands of Grand Turk, Salt Cay, South Caicos, North Caicos and Middle Caicos, will pay a Stamp duty rate of just 4%, and Providenciales and elsewhere in the Turks and Caicos Islands, just 6%.
Mr. Speaker, with these policies, our Government just made private land as affordable for Turks & Caicos Islanders as private land. Mr. Speaker, we said that we will have people living their best lives, and that’s exactly what we’re doing.
DEPARTMENT OF STATISTICS
Mr. Speaker, to properly help our people, our Government needs to know how many of us are there, how many persons are permanently living in country, where people are living, the ratio between young and old, and other socioeconomic factors, such as education and employment.
Mr. Speaker, the United Nations Statistical Commission recommends that all countries carry out a population and housing census at least every ten years, and as I am sure you are aware, the last Census that was conducted in the Turks and Caicos Islands was in 2012. And since that time, new houses have been constructed, the population has grown, and other changes in the makeup of our islands have taken place. Mr. Speaker it’s now Census time again in the Turks and Caicos Islands. And I am happy to inform you Mr. Speaker, that actual planning for the upcoming 2022 Census has already begun, with kickoff activities scheduled to start soon. The 2022 Census will be the most comprehensive data source on the population and housing conditions in country. It will help our Government better understand the conditions under which the people of these Islands live, as we seek to improve the quality of their lives.
For example, Mr. Speaker, the information obtained from the 2022 Census will be used to:
• determine the location, number and types of schools,
• the demand for housing, water supply, and other amenities that are required to give everyone living in our Beautiful by Nature country a decent standard of living.
Further Mr. Speaker, statistical data from the 2022 Census will help officials determine, for example, how many special education teachers are needed in our schools or forecast the number of students likely to live on each island over the next five to ten years. The 2022 Census will also give information on the number of school dropouts, a situation that contributes to crime and other social problems, thereby allowing our Government to proactively address them.
It is stated Mr. Speaker that “the most important capital a society can have is human capital. Assessing the quantity and quality of this capital at small area, regional, and national levels is an important component of modern government.” We are a modern progressive Government Mr. Speaker, and human capital development is one of our flagship priorities. And so, for this, and all of the other reasons previously mentioned Mr. Speaker, I am encouraging everyone to cooperate with the Census Takers – i.e. those persons who will go out into the field to collect the data. The information from the 2022 Census will help our Government to continue to provide a high quality of life for our residents.
STIMULUS UPDATE
Mr. Speaker, on the 27th January 2022, I laid in this Honourable House a Supplementary Budget for FY21/22 of $6.77M, out of which $6.5M was used on a Citizen Inflation Adjustment Stimulus to help our people. I am now pleased to give you, the honorable members of this house, and the listening public an update on the progress of the delivery of that stimulus.
Mr. Speaker, the Citizen Inflation Adjustment Stimulus portal was opened for applications on the 2nd February, and the first cheques were delivered to recipients on the 2nd March. As of 4:30pm on Tuesday, 15th March, the stimulus numbers stood as follows:
• Total number of Applications Received 13,094 (100%),
• Approved Applications 11,481 (88%),
• Duplicate applications 222 (2%),
• Declined Applications 67 (0.5%),
• Applications awaiting further documentation 1,324 (10%).
Mr. Speaker, while I am happy to say that approximately 88% of applicants have already been approved for the Stimulus, which is a phenomenal achievement, it would be remiss of me if I didn’t express my disappointment that 1,324 applications have been deferred pending further documentation. As a number of persons have raised concerns that there are persons (particularly students) who do not have all of the required documents, and as a result, have had their applications deferred, I would like to first point out that deferred is not the same as declined. We have a process that we will use to go through the deferred applications in order to help many of those of applicants to receive a stimulus. So I want those persons to know that we have not forgotten them.
Notwithstanding what I just said Mr. Speaker, I must point out that in order to qualify for the Citizen Inflation Adjustment Stimulus, all each applicant had to do was the following:
1. Submit a completed application form on the Portal,
2. Provide proof of documentation of Turks & Caicos Islands Status Holder (or British Overseas Territory Citizenship), which could be Any of:
a. A Turks & Caicos Islander Status Card; OR
b. A Copy of the Applicant’s TCI birth certificate, along with a copy one or both Parents’ TCI status Card; OR
c. A Copy of the Applicant’s TCI birth certificate, along with a copy of one or both Parents’ birth certificate; OR
d. A copy of the applicant’s TCI birth certificate along with Islander Status Card/Island Status Certificate of one or both of his/her parents; OR
e. A Copy of BOTC passport (if passport is expired the expiration date could be no later than 31st March 2020; OR
f. A Copy of BOTC Certificate.
3. Proof that the Applicant is 18 years or older,
4. Proof that the Applicant lives in the Turks & Caicos Islands, which could include Any of:
a. Active NIB number; OR
b. TCI Voter’s Registration number; OR
c. A copy of a utility bill displaying the applicant’s name, which was issued in the TCI during the last 12 months.
As you can see Mr. Speaker, the issue that the 1,324 deferred applicants are facing is not due to the process not being well thought out, which it was, but due to the fact that many of those applicants did not take the time out to register for important Government programs and services. I’ve been told many times, and I’ve seen it posted many places that students are being asked to provide utility bills in their names, or that they must have an active NIB number, to qualify for the stimulus, and that it is unfair to them. However, what I don’t hear is that those persons also have the option to provide a TCI Voter’s Registration number, but they’re unable to because they have so far opted not to get registered to vote.
Mr. Speaker, I am not sure why some persons choose not to register to vote, or even why they choose not to sign up for TCI Status Card, but whatever the reasons are, I want to encourage them to rethink their position, as persons having the right documentation(s) will makes it easier for government to identify and verify them, and most importantly provide support for them in time of need.
TCIG COST OF LIVING + INFLATION ADJUSTMENT MEASURES
Mr. Speaker, the past two plus years of the COVID pandemic has displaced workforces, disrupted supply chains, and driven up the cost of living right across the globe. Most countries are seeing historic highs in inflation. However, unfortunately, when the world was expecting to see a bit of relief as it turns the corner on COVID-19, the war between Russia and Ukraine is adding to the problem.
As Russia is the world’s third largest oil producer, and Europe’s largest supplier of natural gas, it’s not surprising that the sanctions being imposed on it has caused the price of fuel – i.e. gasoline, diesel, and natural gas – to skyrocket. In early March, the price of a barrel of oil (the standard measure for oil) was above $120, and even though it recently dropped to $100, experts predict that it will increase again.
Mr. Speaker, unfortunately the increase in fuel prices, isn’t limited to the pump, as energy, produced by fuel, is what drives the industrial world, and as a result, the rapid rise in fuel prices is pushing up the costs of products and services across the board. Mr. Speaker, prices on Key Food Items are expected to increase by an average of 2.5%. Due to this Mr. Speaker, Cabinet approved a $15 million Cost of Living and Inflation Adjustment Relief Package consisting of:
1. A 25% reduction in the Additional Tariff on Fuel, thereby reducing it from $0.85 per gallon to $0.64 per gallon – a $0.21 per gallon savings to the consumer. The proposed foregone revenue from this initiative is approximately $2.8 Million.
Mr. Speaker, as this measure will not result in a reduction in electricity bills for consumers, due to the fact that Fortis TCI does not pay any Additional Tariff on Fuel, Cabinet also approved:
2. A reduction in CPF from 7.5% to 5% on all items. The proposed foregone revenue from this initiative is expected to be $12 million.
Mr. Speaker, these measures will be in place for 12 months, and if they needed to be reviewed and/or enhanced our Government is prepared to do so.
Mr. Speaker, our Government cares for our people, and the Ministry of Finance works very hard to ensure that we are achieving that. May God continue to bless you, our People, and Our Beautiful by Nature country.
Good day.
Hon. E. Jay Saunders
Minister of Finance, Investment & Trade
