The Allen Chastanet administration will be announcing the new rate for the Value Added Tax (VAT) by the end of October this year.
Governor General Dame Pearlette Louisy said on Tuesday in her Throne Speech that discussions have been initiated with regional and international institutions to assess the country’s finances to determine the rate at which VAT could be reduced.
“We wish to express our appreciation to the Eastern Caribbean Central Bank, the Caribbean Development Bank, the World Bank and the International Monetary Fund who are assisting us in undertaking this exercise. It is expected that my Government will be in a position to announce the new rate of VAT before the end of October 2016,” she added.
The head of state said many persons would recall that Estimates of Revenue and Expenditure for the current fiscal year were tabled and passed in Parliament by the out-going administration without presentation of the policy considerations that informed those estimates.
“My Government finds it necessary therefore to undertake a comprehensive review of those estimates in order to determine their realism and how they affect the priority issues in health, education, justice, national security, social safety nets and other areas, which we believe must be tackled in the short and medium term in order to bring economic and social stability first of all, and ultimately return our country to a path of sustainable economic growth,” she explained.
Dame Louisy said her government will then present the revised estimates informed by the new policy priorities for the remainder of the fiscal year. However, she noted that the real manifestation of the new policies to be implemented by the new government will begin to take effect in the next fiscal year 2017 / 2018.
In addition to that there will be an increase in the school transportation subsidy and school feeding programme starting in the new school year in September.
Meanwhile, legislation to facilitate the introduction of the amnesty on hospital bills and the reduction in vehicular licence fees will be tabled at the next sitting of Parliament in August, and the freeze on the payment of taxes on residential property will be implemented in the next fiscal year.
“While the measures just outlined are intended to bring some short term relief to our citizens, fixing the structural problems which we face, and creating a more efficient system for the attraction of foreign investment, will inevitably take longer. The specific investment projects geared towards creating sustainable jobs will be announced when my Government makes a presentation to Parliament on the economy,” the Governor general explained.
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