Past president of the Joint Consultative Council for the Construction Industry (JCC) Afra Raymond says he supports the Government’s bid to collect property tax.
But in an interview on CNC3’s the Morning Brew with host Jason Williams yesterday, Raymond said he has doubts about whether the taxation system will be implemented.
He said T&T first began grappling with the issue of property tax in 2009 when it was introduced under the Patrick Manning administration. Raymond explained that while property tax is not new in T&T, the proposal brought by the People’s National Movement in 2009 sought to modernise it.
“That set of proposals is what we are still grappling with 12 years later because the meaning of it is that we wanted to have a system that created up to date valuations of property that was based along the rental value of property and a system that was modern because the old system was really a kind of book-based system- with these big books where you write out all of this information,” Raymond said.
He said a modern system would require less manual input, create more revenue for the State and better service for citizens.
“To summarise, I have been in support of a modernisation and a revision of the property tax system since 2009, there are two or three significant issues with it, problems, but by and large, I support it.”
Raymond said there does not seem to be much prospect to the idea that property taxes will be passed on to tenants by landlords because there was more supply than demand for rental properties.
He sought to explain how much money citizens would have to pay in property taxes.
Raymond said if a property was valued at $3,000 a month in rental value, it would amount to a yearly figure of $36,000. From that figure, he said the law allows for a ten per cent reduction- bringing the Annual Rental Value (ARV) down to $32,400.
“The annual taxable value of the property, you are taking three per cent off that– three per cent of $32,400 is about $960 or $970–$970 divided by 12 is like $80 a month,” he said.
Williams pointed out that a lot of worry over the implementation of the property tax stemmed from clauses within the law that allow the State to seize properties in cases where land owners do not pay their taxes.
Raymond said he was sceptical about whether the tax would be implemented at all, given the narrow majority of the PNM in the August 2020 general election.
“That is the first fact: that the majority that the PNM enjoys at the moment is narrow so one has to be careful in that scenario how you spend your political capital,” he said.
But he said the country also does not have a history of prosecuting those who fail to pay taxes.
“And those laws about property being sold if you don’t pay your taxes, those have always been there, those were there in the old system, they are not laws that are being introduced or were introduced by Mr Manning in ’09, those provisions were always in the law, any modern taxation system has that but I am saying we as Trinidadians and Tobagonians have never honoured that part of the system so I don’t think that’s a big issue to be spending our time on,” Raymond added.
He said while he agrees that property tax should be implemented, he does not agree with the Government’s proposal that the revenue generated should go to the Central Government.