BASSETERRE, St. Kitts – FEDERAL Opposition Leader Hon. Mark Brantley said the announcement of a likely Value-Added Tax (VAT) rate of 19 percent has made “a mockery of democracy”.
Brantley was responding to a statement by Prime Minister Hon. Dr. Denzil Douglas in which the Kittitian leader said he was advised that a VAT of “19 percent may be the way to go”.
Douglas told the Caribbean Media Corporation that while the final rate was yet to be determined, a rate of 15 percent would probably be insufficient to fill government financing gaps.
Regionally, Jamaica has the highest VAT rate with 17.5 percent, while Dominica follows closely with 17 percent. Antigua and Barbuda, Grenada and Barbados all have rates of 15 percent.
“Nineteen percent is demonstrably higher than everywhere else in the region. It tells me our fiscal mismanagement has been so acute over the last 15 years that the government is now seeking to implement desperate measures.
“The PM should roll back this potential decision and initiate a serious consultation process, not the show that they’ve putting on. The public and the community have not gotten serious consultation; everything has happened after the fact,” Brantley noted.
The Nevisian politician claimed that VAT implementation had not been adequately conceptualised, and stressed that it would bring “serious hardship” to a country that is already facing considerable troubles.
He said the government was trying to mislead people by claiming that VAT would be a “panacea” to their struggles.
“This entire process has been rushed and shoved onto the public. The government must face up to the realities of our situation and stop trying to fool people with misinformation. If VAT is supposedly such a good thing, then why was it not mentioned before the general election?”
Added Brantley: “The government needs to have a greater level of openness with us. Two years ago, they said the national debt was nothing to worry about. And even now, they don’t want to admit the predicament we’re in.”
PM Douglas’ announcement is sure to draw the ire of the business community, which had said during a recent VAT stakeholders’ consultation that they would prefer a rate of no more than 15 percent.
In recent interviews with the press, Michael Head, Executive Manager of the Hotel and Tourism Association, had called for VAT to be introduced in April 2011 to ensure that the fragile economy would not be negatively affected by its implementation.
