Legitimate hotel and accommodation operators are being disadvantaged since they remit the hotel tax to Government but other operators who run Air B&B places or dwellings converted to accommodation don’t remit the tax.
Tourism Minister Randall Mitchell indicated the situation in yesterday’s Senate debate on the T&T Revenue Authority (TTRA).
He said he understood fears on if TTRA can perform in the way expected and he sought to assure concerns on it.
He said TTRA’s focus will be on voluntary compliance and ease of doing tax business. Despite fear-mongering taking place, he said, “The vast majority of taxpayers in the public and private sectors have nothing to fear as they’re subject to PAYE and their taxes are deducted from the source and remitted by their employers.”
In tourism he said, owners of legitimate hotels are at a disadvantage since they pay the hotel tax but others with Air B&B operations or more than six rooms or dwellings converted to accommodation don’t remit the hotel tax even if it’s advertised.
Mitchell said other statutory authorities —like the TTRA—will be created for Central Statistics Office Records—the National Statistics Institute—to manage the North and South Academies for the Performing Arts, and the Maritime and Civil Aviation authorities.
Mitchell said if there were efficient revenue authorities perhaps there would be no deficit but while the Opposition spoke of inefficiencies and deficits they refused to support the TTRA bill.
He said when there is proposed law like to create a statutory authority to engage in tax revenue administration reform, “How does one counter-argue that ‘PNM looking to enter people pocket’ or ‘you have to line up at Balisier House to get a TTRA job’ when the Opposition is misrepresenting and spewing propaganda?”
“We’re debating real legislation to seek effectiveness and remove bureaucracy this isn’t an extension of Douglas Politics!”
TTRA won’t produce immediately
Independent Senator Amrita Deonarine felt the Government’s projection of certain increased revenue over the next few years after the T&T Revenue Authority is established may not be possible since revenue authorities take one to two years to become fully operational.
Deonarine said passage of the bill cannot be seen as the be-all and end-all to all tax administration deficiencies and it wouldn’t suddenly increase revenue as it’s a process and that will take some time.
Deonarine hoped TTRA would be conducive to performance and not create another state-centric institution or the same inefficiencies being noted now would recur, “My concern is how effectively will the structure work and how many problems will we eliminate to improve tax administration.”
She noted problems including demotivated staff susceptible to bribery. She said employees will continue to be appointed and disciplined by Public Service Commission.
“So how much of an avenue will we have to develop an agile working environment with performance-based targets?”
Deonarine added corruption would have to be rooted out for tax compliance to increase. She noted revenue projections from 2022 to 2024 of increased percentages of GDP given by the Finance Minister in debate but didn’t think it was possible. Deonarine queried how Inland Revenue and Customs would work together fulfilling functions, be coordinated, and how respective systems would be integrated and streamlined. She queried the cost to establish the TTRA.
“Implementing TTRA will take time. As much as we need the additional revenue at this time, it’s not something to rush. We need to try to get it right. I’d encourage some time frame or adopt a phased approach added in the laws.