The T&T Chamber of Industry and Commerce has praised a number of measures in the 2021 Budget, including steps to develop the local agriculture and agro-processing sectors.
However, it has many concerns and said it would have liked to see more effort towards tightening government expenditure to reduce the deficit in the Budget.
In a release last evening, it also raised questions about revenue projections for fiscal 2021 – it says more detail is required with regards to non-energy income, as it appears high.
The Chamber did credit the Finance Minister for acknowledging the challenges faced by the gas value chain, but warned that it is “critical” for work there to be completed quickly to ensure long term sustainability of the sector.
The Chamber said it was also encouraged by the statement that the Petroleum Act will be reviewed. Hopefully, this can be done sooner rather than later.
“The Government’s push to start the energy transition is also encouraging. However, greater focus must be made on energy conservation and reducing wastage. We encourage the government to lay out a clear long-term plan for the energy transition, which if successfully done, will create opportunities for investment.”
In particular, the Chamber said it is looking forward to the continued digitalisation of government services to improve the ease of doing business and efficiency in the judicial system through virtual courts.
But, they are disappointed that more was not done to address VAT and tax refunds, such as introducing net offs and a separate ring-fenced fund.
“While the Minister has mentioned that a second tranche of VAT bonds will be issued, we await the details on timelines and value. The current VAT and tax refunds situation must be made current; otherwise it will continue to have a debilitating effect on businesses.
We welcome the announcement of the Electronic Funds Transfer Window to pay taxes and customs duties online. We call on the Opposition to support the establishment of the TTRA, failing which priority must be placed on alternative mechanisms to widen the tax net.”
As it relates to property taxes, the T&T Chamber has continuously advocated for the 6% tax to apply strictly to physical property and not on installed plant, machinery and equipment. It is counterintuitive to implement measures to encourage manufacturing activity while taxing machinery and equipment used in factories.