Home' Trinidad and Tobago Guardian : January 11th 2016 Contents Minimum wage still to be reviewed --- McLeod News --- Page A6
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for 08TH JANUARY, 2016
Prakash Ramadhar, political
leader for the Congress of the
People (COP) said 2016 will
be difficult on all fronts and
the return of the controversial
Property Tax will only make
the country s situation worse.
He said the COP does not
believe in redistributive policies
but in wealth creation.
"This year ahead of us from
all indications will be a chal-
lenging one. Not just in rela-
tions to the upsurge in crime
we have seen recently but the
uncertainty of our economic
future and the measures that
have been indicated by our
Government to deal with the
financial and economic short-
falls. We have seen now that
the tax whatever form of val-
uations they use, will go to the
national consolidated fund, and
not to the regional corporations
that the tax should go to," he
Ramadhar spoke to the
media yesterday at a media
conference at COP s Operations
In 2009 the Property Tax
Act was passed by the Patrick
Manning Government but was
never implemented and in 2011
it was suspended by the Peo-
ple s Partnership Government.
That tax had replaced the Land
and Buildings Tax.
The Keith Rowley Govern-
ment is to return to the tax, to
offset the revenue shortfall from
low oil prices.
Ramadhar said in 2009 the
COP led a charge against the
then Government against the
implementation of the Property
Tax and now it appears to have
He spoke about "uncertain-
ties" on what the Government
meant by the return of this tax.
Clyde Weatherhead, COP s
General Secretary who also
spoke at the media briefing,
said the Government is not
clear about what type of tax
will return as in the October
budget the Finance Minister
indicated that the Property Tax
is to be "phased back in" in
2016 at the "old rate and value."
He also referred to the Prime
Minister s speech at the end of
December when Rowley spoke
about a Land and Buildings Tax
which would be introduced in
"Land and Buildings Taxes
no longer exist, and the basis
on which they were calculated
is completely different from
that of the Property Tax. So
you cannot amend the Property
Tax Act to recreate the Land
and Building Tax. So it is
unclear what the Government
is saying. There needs to be
clarity on what is the basis for
valuation," Weatherhead said.
He said the Land and Build-
ings Taxes represented two dif-
ferent taxes, one on land and
the other part on buildings.
He added that if in 2009 a
person with two acres of land
paid $20 on land taxes, in 2016,
based on the Property Tax Act
of 2009, the owner would pay
"So for a three bedroom
house if you use capital value
which will be about a million
dollars, the Property Tax in
2016 which would be three per
cent of that will be $30,000.
The rate is three per cent on
residential properties, five per
cent on commercial property,
six per cent on industrial prop-
erty and one per cent on agri-
cultural land," he said.
He said the COP will be
going to different communities
in the country to explain the
ramifications of the Property
Tax especially in light of the
possible rise in prices in gas,
water, electricity and food in
"With all of this, can we deal
with a Property Tax that be
based on capital value and
increase our taxes tremendous-
ly? We need to educate the
Even though the revised Value
Added Tax (VAT) list is to be
released today during the debate
of the Finance Bill 2016, presi-
dent of the Supermarket Asso-
ciation of T&T (SATT) Dr Yunus
Ibrahim said members of SATT
were not consulted about what
items should return to the list.
He said when the list is released
today, he would be seeing it for
the first time just like the other
members of the public, but his
membership stands ready to make
the changes which take effect on
In mid-November 2012, the
then government led by Kamla
Persad-Bissessar had announced
that VAT would be removed from
7,000 grocery items.
She had said the removal of
VAT on those items would ease
the burden on consumers pockets
from continuous rises in prices.
During the budget debate in
early October 2015, Finance Min-
ister Colm Imbert had announced
that VAT would be reduced to
12.5 per cent.
He said the government wanted
to improve efficiency and to
broaden the base, by reviewing
and adjusting exemptions and
zero-rated items "which are asso-
ciated with non-essential or lux-
ury items, and which are not crit-
ically important to the livelihoods
and basic cost of living of our cit-
"And consistent with our 2015
manifesto promises, I propose to
reduce the VAT rate from 15 per
cent to 12.5 per cent."
In its January 8 statement the
Ministry of Finance said the
Finance Bill of 2016, will be pre-
sented in Parliament today and
included in the Bill would be the
proposed amendments to Sched-
ule II of the VAT Act 75:06.
"This list will be released once
it has been laid in Parliament.
The reduction in the rate of
VAT to 12.5 per cent and the
changes to the range of items,
subject of VAT will become effec-
tive February 1, 2016." The list
was originally scheduled to be
released on January 8.
In a telephone interview with
the Guardian yesterday, Ibrahim
said the month-end period was
usually the busiest time of the
month for supermarkets to do the
changes, and doing so for a large
number items was going to be
The list becomes effective in
February. He says it s more than
David Rudder entertains patrons during Charlies Roots 40th anniversary celebrations, Under the Trees, at The
Normandie, St Ann's on Saturday. PHOTO: ANDRE ALEXANDER
The Property Tax Act of 2009, introduced by the then PNM
Government was an act designed to make provision for the
assessment, rating and taxation of land and property.
The Act was supposed to have been the basis of a complete
revision of the country's property tax system, insofar as the old Land
and Building Taxes and House Rates were concerned.
The new Government has not yet provided any details on how a
revised Property Tax will work.
However, using the capital value, if an owner has a three bedroom
house worth one million dollars, based on the three per cent rate, the
tax the owner would pay would work out to be $30,000 in 2016.
At a rate of one per cent, if someone owns agricultural land worth
$750,000, the owner would pay taxes of $7,500.
At a rate of five per cent, if someone owns commercial property of
$1,000,000, the owner would pay taxes of $50,000.
The taxes that property owners would pay, would work out to be
much higher than the old Land and Building Taxes Act.
EXPLAINING PROPERTY TAX
a question of how long the phase-in period is---it s
a question of timing.
"January 11 for the list being posted is more than
sufficient time we need to do our background work.
We are happy with the timespan", he said, (but) the
reality is that even if we have the list beforehand
you still must have a period where you are going to
lower the VAT and include the new figures, the new
items and whatever tweeks there may be," he said.
Ibrahim said labelling was a challenge which comes
with the timing of the introduction of price increases
as this may mean that supermarkets may have to
employ workers on extra, overnight shifts.
"The only problem that we are foreseeing is
labelling because according to law you must advertise
your price inclusive of VAT. It is going to be a re-
tagging of the current items and re-tagging of the
He said the label can only be printed subsequent
to price changes therefore, "we have to effect the
VAT and then make changes."
Supermarkets will find
VAT changes difficult
RUDDER AT ROOTS
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