CHARLESTOWN, Nevis (DECEMBER 10, 2009) -- Premier of Nevis and Minister of Finance Hon. Joseph Parry said while no new taxes would be introduced by the Nevis Island Administration in 2010, its focus would be on improving the efficiency of the tax system.
Mr. Parry made announcement when he delivered the 2010 Budget Address at the Nevis Island Assembly on Wednesday.
He pointed to a number of initiatives that the NIA had introduced to alleviate poverty and assist the business sector to buffer against the impact of the world recession.
They included the removal of duties on basic food items that gave relief to vulnerable groups; the provision of duty free concessions to small business operators on vehicles and equipment; hotels and villas were given duty free concessions on refurbishment of their properties and small hotel operators and restaurants affected by the fall off in tourism arrivals, had been given duty free relief on the purchase of food and wines.
However, the Premier said while those initiatives would continue in 2010, new ones would be added.
“Effective from January 01, 2010, we will grant duty free concession on electronic security systems to encourage businesses and home owners to protect their properties from criminals.
“With the increase in break-ins that have occurred over the years, there is need for our people to become more vigilant and install alarm systems and security cameras where possible. This will go a long way in assisting the police and in curtailing criminal activities,” he said.
The Premier also spoke of the Administration’s long term strategy to promote Nevis as a green destination and its energy conservation efforts.
“We will grant duty free concession on the implementation of solar water heaters and wind turbines. The cost of energy from fossil fuel is expected to rise significantly in the future and thus we must encourage our people to pursue alternative and environmentally friendly sources of energy,” he said.
With regard to the improved efficiency of the tax collection system, Mr. Parry disclosed that the NIA was collaborating with the Federal Government to explore the possibility of the introduction of the Value Added Tax (VAT).
He explained that VAT would increase tax coverage and replace several other taxes among them Trades Tax, Hotel Room Tax, Travel Tax, Vehicle Rental Tax, Insurance Premium Fee, Parcel Tax, Consumption tax and Export Duty.
It would also bring all of those taxes under one legislative and administrative framework and management and enforcement would be easier. The introduction of VAT, Mr Parry said, would allow for more effort to be expended on collections.
The Finance Minister said base on the experience of other Caribbean countries, the VAT had the potential to generate additional revenue, reduce the cost of living and bring greater equity to tax assessments on individuals and businesses.
“Presently, my government has three officers working full time in St. Kitts along with officials from CARTAC and the St. Kitts Ministry of Finance undertaking research work and getting a better understanding of the system. When the preliminary work is completed and the administrative issues between St. Kitts and Nevis are resolved, a final decision will be made on the implementation of VAT,” he said.
