Tuesday 20 October, 2020

Opposition Leader knocks government for new taxes

Opposition Leader, Joseph Atherley has raised a number of questions regarding the new tax measures announced in the Prime Minister's Mini-budget, saying the measures may bring more pain to an already exhausted economy.  

In his reply to the Mini-budget on Tuesday, Atherley praised government for keeping its manifesto promise of repealing the National Social Responsibility Levy (NSRL). But he noted that the slew of other taxes announced may very well be counter-productive to economic growth.  

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"The removal of that levy has been countered by the imposition of a raft of other taxes. The net effect of these new impositions, alternative to the NSRL, is likely also to be reflected in the negative impact on economic activity going forward." 

The increased tax measures outlined by Mottley include a new Fuel Tax, increased Corporation Tax, a room levy on hotel rooms, a departure tax for those travelling in and outside of CARICOM states, as well as a VAT charge on goods purchased online.  

Atherley said while the Fuel Tax was commendable as government tried to move away from the hefty cost of the Road Tax, he noted it may have an adverse impact on road users.  

"They [road users] will move from $400 in Road tax to $603.20 by payment at the pump." 

Atherley described the policies as "economic unwisdom" where government was trying to dampen consumption and at the same time rely on increased taxation to boost government revenue.  

He again questioned if government's policy was well thought out by its Economic Advisors or whether they were taking directive from external financial agencies.  

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"Are we truly devising a homegrown program of corrective measures or is this a reaction to signals we are receiving from the International Monetary Fund? 

"Did this government, with its 30-nil electoral victory, have a mandate for this approach to the problems in our economy? Did we sufficiently send signals of the painful path ahead?" 

Atherley also raised concerns about government's decision to suspend payments to creditors, saying it could do further harm to Barbados' reputation in the international market.  

He suggested government could have sought help with its debt from other countries such as China or perhaps even the United Arab Emirates. Atherley added he hoped the "awful medicine" government was administering to its citizens yielded the results intended over the next three years.  

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