Government’s Recovery Roadmap team is discussing the “paramount need” to plug tax loopholes to assist existing revenue and the collection of state land rental could also figure in the T&T Revenue Authority’s (TTRA) work ahead.
Revenue collection also needs improvement since the Roadmap Committee’s ideas include a $3 billion plan to deal with T&T’s water situation “once and for all.”
Public Utilities Minister Robert Le Hunte and Agriculture Minister Clarence Rambharat spoke about the issues during yesterday’s Senate debate on the TTRA bill.
Le Hunte said the present tax system allows $15 billion to slip by.
“This can’t be allowed in the global climate when economic indicators seem to be free falling,” he added.
“In this new COVID time and post-COVID environment, we can’t continue with a laissez faire attitude to revenue collection and having large numbers of people not being registered. It’s not fair and equitable. What we have is an unworkable system. The crisis provides us with time to reflect on the failure in tax failure going on a long time,” he said.
He said the Roadmap team’s conversations on Thursday included examining revenue.
“What was paramount was the need to plug loopholes to assist with existing revenue and deal with where revenue’s flowing out. A TTRA is one step to be taken on that journey.”
Le Hunte said over 200,000 people are outside of the formal tax system—32 per cent of the labour force.
“We can’t continue with such inefficiency. Lost revenue (which is) collected and allocated to Ministries can make a meaningful contribution,” he said.
Le Hunte said he’s working on a Roadmap project to fix T&T’s water situation once and for all. But it’ll require over $3 billion…. Yet we have revenue out there and not collecting over $15 billion. One year of an efficient collection system will mean we won’t have to borrow—we’ll just need to collect revenue,” he said.
Le Hunte stressed it cannot be business as usual.
Agriculture Minister Clarence Rambharat said the COVID-19 crisis needs money as Government put itself in significant debt.
“The situation’s driven the need for an authority to collect revenue,” he added.
Rambharat said while TTRA’s been a longstanding idea, it’s now more urgent to collect all available revenue.
“VAT leakage is a big problem,” he noted.
He said while there are no plans to bring state lands under TTRA’s collection processes, it would get there once TTRA’s up.
Rambharat said there was no reason why collection of rent for state lands should have been stopped.
“One survey found there’s half a billion dollars in uncollected rent,” he noted.
“Rents aren’t being received – this is potential money uncollected. So many leases are expired and lands are occupied without leases. I’m dealing with leases expired 30 to 60 years,” he said, adding that people were using land without paying “the pittance” it cost.
Rambharat noted land in Couva cost $6-$9 million an acre while rented state land for agriculture is $500.
He noted there are many employed who aren’t taxed or on the NIS system. One of the benefits of administering to this large group seeking income assistance, is they’ll have to come forward.