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Posted: Thursday 3 July, 2014 at 11:44 PM

Team Unity promises to remove VAT from some essential items

Hon. Dr. Timothy Harris
By: Jermine Abel, SKNVibes.com

    BASSETERRE, St. Kitts – AS the Federation prepares itself for the upcoming General Elections, one political group has begun its groundwork by stating what it would do for citizens and residents of St. Kitts and Nevis. 

     

    The political group is the Unity Construct that has pledged to remove Valued Added Taxes on several “essential items”, which, according to its Leader, is expected to alleviate poverty within the Federation.

    Leader of Team Unity and Prime Ministerial Candidate the Hon. Dr Timothy Harris, speaking with SKNVibes Business at the opening of the party’s Head Quarters in Basseterre, stated that all economic policies that his party has put forward has been well thought through”.

    According to Dr. Harris, this would give the ordinary citizens of the Federation an increase in their spending power.

    “The principle behind VAT reduction is a very simple one. The removal of VAT from foods, medicine, from funeral expenses and education supply basically would put more spending power in the hand of the ordinary people.

    “Just as we see on VAT days where businesses have record sales, what that is going to translate too is record sales for even the distributors throughout the year,” Dr. Harris explained.

    He stated that the combination tax is a hindrance to the continued growth of the Federation’s economy. And with it being eliminated from the said items, the country’s economy is expected to grow.

    “The excessive nature of VAT is basically choking the economy, and so what we are going to do by reducing it is to give the economy a boost. So the additional growth that is going to take place is going to make up for us reducing VAT.”    

    However, the Party’s Leader did not give an encouraging word on what would be done to facilitate the loss of revenue from completely removing the VAT from these items.

    When asked if it is too rash for the party to abruptly remove the tax rather than phasing it out over a two or three-year span, Dr. Harris said: “Like I have told you, VAT is on over ten thousand items and we have only selected four, so there is no irrationality. And the basis of that is predicated on poverty alleviation and it’s a moral imperative.” 

    He reiterated that his party “is completely removing VAT from the selected items”.

    “We say food, funeral expenses, medicine; these are the areas in which the poor are more vulnerable. And we have added, after consultation with the Teachers Union, educational supplies.” 

    He noted that one principle of taxation is that it should not be excessive.

    However, some individuals would argue that the indirect tax on these items has allowed the Federation to begin clearing its debts with international donor agencies.
     
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