Mixed reaction to Irion’s tax reform presentation

Mixed reaction to Irion’s  tax reform presentation

PHILIPSBURG--There was mixed reaction from Members of Parliament (MPs) to the tax reform presentation delivered by Finance Minister Ardwell Irion on Monday.

  United Democrats (UD) MP Sarah Wescot-Williams, one of the MPs who requested the meeting more than a year ago, said that while it is appreciated that MPs received some indication of possible tax reforms, the presentation makes one wonder where government stands on the issue of tax reform, not just on the status of the reform trajectory, but on tax proposals such as land tax, sin taxes and transaction taxes, amongst others.

  She said government had approved a Fiscal Reform Plan in 2015 and several items of that plan reappeared in Irion’s presentation. “There are too many plans and proposals to get a clear view of what this government’s position is on land tax, financial transaction tax, VAT [value-added tax – Ed.] etc.,” she said.

  “Like was done in the 2015 presentation, this presentation calls for the abolishment of the land tax law. Yet, recently, the CFT called for implementation of land tax. So again, which is it? And who ultimately decides? The tax proposals in the country package of St. Maarten, can/will these be changed in line with the proposals presented by the Minister of Finance? What about the legislation to amend several taxes that are in the pipeline?” Wescot-Williams asked.

  “Are the TWO/COHO in sync with these reforms? Will the implementation agendas be amended to reflect these new processes, since according to the minister, no further review of the tax system will be done? What are the next steps in the process? Which of the specific tax proposals are ready for debate and consultation with the parliament and the wider community?” she queried.

  United St. Maarten Party (US Party) MP Claudius “Toontje” Buncamper said that while the discussions are about a sustainable tax reform system, the number of undocumented persons in the country makes one wonder how it will work.

  His questions included how will the country deal with the local challenges at the tax office and the Fiscal Affairs Department regarding capacity issues. He also asked how long the tax reform project will take, given that a process began on other Dutch islands and is still continuing after 11 years.

  He also asked whether the turnover from casinos will be controlled to ensure that the correct amount will be paid in turnover tax (ToT) in addition to the regular taxes that have to be paid. He also asked why the country would abolish the direct room tax of five per cent (which should be paid directly to the government) and replace it with ToT in which government stands to lose five per cent.

  He said the proposal for the proposed new tax threshold for seniors of NAf. 40,000, would only be acceptable if this is part of the new income tax ceiling for seniors age 65 and older. “The present income from seniors in taxes is some NAf. 2 million and can be found in a different manner and should be done within budget 2022,” Buncamper maintained.

  He also asked whether seniors would be exempted from all wage taxes on their pensions. He queried whether the proposed taxes on alcohol, tobacco and sugar-based products as well as the special taxes on diesel fuel and gasoline will be discussed in detail with counterparts in French St. Martin and wanted to know how the taxing of gambling winnings will take place.

  Other questions included whether government will table the law regarding the abolishing of land tax to the floor of Parliament by the end of the year or early 2022 as a part of the low-hanging fruits of tax reform and whether government, the TWO and the FAD have the same positions on the presentation Irion made to MPs.

  Independent MP Christophe Emmanuel said he was “bitterly disappointed” with Irion’s presentation. He said the presentation was “neither here or there” because the minister seems to have met with no one and there is nothing that MPs can hold on to or grasp to identify something that government is doing  on the issue. He called Irion’s remarks “a presentation of nothing.”

  United People’s (UP) party MP Rolando Brison said that for transaction tax, compliance will be easy, as it would be collected by banks and transferred to government similar to what is done with the foreign exchange licence fee via the Central Bank.

The Daily Herald

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