BASSETERRE, St. Kitts – PRESIDENT of St. Kitts and Nevis’s Chamber of Industry and Commerce (CIC) Michael Morton is of the firm view that the government stands to lose if VAT were to be implemented while the country is in a state of unpreparedness.
Morton expressed these sentiments yesterday (Oct. 25) following a press conference held to inform the public of the Chamber’s state of readiness and also that of the country for the implementation of VAT, scheduled to take place in a matter of days.
Speaking exclusively with SKNVibes, Morton said the CIC is in the process of drafting communication to be sent to the government, requesting a delay in the imposition of VAT so as to allow for a period of time “to better understand the laws and regulations. We are saying we need some time”.
Officially announced in March 2010, the Federation was given approximately seven months to prepare itself for the imposition of VAT. Morton explained that the nation is ill-equipped and that in most countries where VAT was implemented, at least a two-year period was allowed for the purposes of preparation.
“Government, at the end of the day, will be the biggest losers if VAT is not properly implemented. If the vast majority of persons do not comply with the regulations, the government will not be collecting the monies that they have estimated to collect from VAT. It’s as simple as that. If the public is properly educated, the businesses are likewise educated, and the Inland Revenue Department is properly prepared to man and to ensure that the legislation is followed to the letter of the law, I believe then that…VAT (would be) smoothly implemented, thus ensuring that government’s revenues will increase significantly and that it will have the desired results that is to improve our fiscal performance.”
Morton warned that just as was the case in Grenada during that country’s first attempt of VAT implementation, it could spell disaster in the Federation if the government follows through with its November 1, 2010 deadline. He added that the Federation is not prepared for 100 percent compliance.
“But if it isn’t, what happened in Grenada will happen here. The first time Grenada attempted to introduce VAT, it was so chaotic they had to discontinue, forget it and start all over again. Most countries are given at least two years to prepare for VAT.”
The CIC’s President told SKNVibes that a more appropriate implementation date would have been either February 1 or March 1, 2011. He noted that it would have afforded “one year to prepare St. Kitts and Nevis for the implementation of VAT (which is) the minimum time that ought to have been given, rather than a few weeks, because I cannot say we have been given months…because we do not have all that we need to really be prepared for the implementation.”
