The Valuation of Land (Amendment) Bill, 2023 has been passed.
The bill was piloted by Finance Minister Colm Imbert and was passed late Wednesday night by a 18-14 vote.
Clause 5 of the bill repeals and replaces Section 7A of the Valuation of Land Act, Chap 58:03, by introducing specific categories of land to be valued, namely residential land, commercial land, industrial land and agricultural land, in order for the valuation roll (list of properties assessed and valued by the Commissioner of Valuations) to take effect and property tax determined.
Imbert noted that under the current Valuation of Land Act, the word “land” could be interpreted as being “everything”, even swamp land, land under water and the forest.
He said this was why it was proposed that the threshold of 50 per cent required for the Commissioner of Valuations to create the valuation roll include the specific categories of land.
“In other words, the Commissioner of Valuations would, in this amendment, be able to value 50 per cent of residential land, or 50 per cent of commercial land, or 50 per cent of industrial land, or 50 per cent of agricultural land. And when the valuations in the various categories have been completed to the threshold of 50 per cent, the commissioner can then proceed to create the valuation roll and send that to the minister for continuation of the process,” Imbert explained.
Imbert said based on all available data, including from aerial photographs, the Trinidad and Tobago Electricity Commission (T&TEC), Water and Sewerage Authority (WASA), TTPost and records from the old Land and Building Taxes system, there were approximately 600,000 properties in T&T.
He said recently acquired data from T&TEC showed that about 400,000 of the 600,000 properties connected to electricity were residential; 49,000 were commercial; 3,000 were industrial; and the rest fell into agricultural and other categories.
He said so far, the Valuation Division had digitised the building outlines of 570,541 properties in T&T.
In terms of residential properties, Imbert said the Valuation Division had advised that “quite some time ago”, they had exceeded the 50 per cent threshold for residential properties.
He said at this time, 232,000 residential properties were ready for the valuation roll.
“And, therefore, when this legislation is passed and there will be no more ambiguity as to whether the 50 per cent would include categories of land like swamp, forest and land under water…when it now becomes crystal clear that it is 50 per cent in each category, having reached 232,000 properties in the residential category, and that being more than 50 per cent, I am satisfied that within the next month or so, the Commissioner of Valuations will be able to produce for me the valuation roll for these 232,000 residential properties,” Imbert said.
He added: “After the valuation roll is produced to me and I make the necessary order declaring that the valuation roll has been created, that roll is then sent to the Board of Inland Revenue where the percentages in the Property Tax Act would be applied, and as I said, it is three per cent of the rental value.
“Taking the typical property at the lower level that would rent for maybe $3,000 a month, the Board of Inland Revenue would then call upon the owners of those properties at that level to pay a tax of $1,000 per year, $90 a month.”
He said owners with properties of greater value will pay more.
“If I take somebody living in Fairways, Valsayn, Palmiste…in wealthier areas where a property might rent for $10,000 a month or $120,000 a year, the property tax would be three per cent of that, which would be ($3,600) per year,” he said.
“That’s still one-quarter of what it will be if you’re living in England or the US in a much smaller unit,” Imbert said.
He said property tax was used in more than 150 countries in the world to provide an income stream for local government bodies.
“What we are doing is finally bringing T&T into the modern era, finally creating a dedicated income stream for municipal corporations, no matter which political party is in charge, and finally providing local government bodies with the funding that they require,” Imbert said.
He chided the Opposition for “speaking out of both sides of their mouth”, on one hand saying that local government bodies were starved of funds, and on the other hand objecting to property tax.
He stressed that property tax will generate funds directly for local government corporations to spend on the very goods and services residents in their regions needed.
“So we need to get on with this,” the Finance Minister said.