No property tax increase coming – Prime Minister

Contrary to reports, property taxes in St.Vincent and the Grenadines will not be increased in the near future.

This was stated by Prime Minister Dr.Ralph Gonsalves on Tuesday, December 1, at a press conference, as he sought to refute claims that property taxes were on the verge of being increased.{{more}}

Prime Minister Gonsalves told the media that former Prime Minister Arnhim Eustace had left a proposal for the refashioning of the property taxes with the Ministry of Finance when he left office in 2001. Gonsalves said he agreed with Eustace that there is a need to re-examine this area of taxation.

To date, a study on the issue of property taxes in St.Vincent and the Grenadines has been completed and has been submitted to Cabinet.

“The Cabinet has not taken any decision on it. In fact the Cabinet hasn’t formally discussed the document and I certainly do not anticipate that we will have any property tax which would involve an increase in property taxes,” said Gonsalves.

Meanwhile, the prime minister reminded the nation that even though some persons’ salaries have increased, their personal income taxes have decreased.

He said when he came to power the top rate of income tax was 40 per cent. This has decreased to 32.5 per cent.

Gonsalves expressed this is in keeping with a promise he made to have personal income tax decreased to 30 per cent by the elections of 2010.

“The term after that, I hope to take it down from 30 to probably 25,” said Gonsalves.

Similarly, the Gonsalves led administration increased the threshold below which persons wouldn’t be taxed from $12,000 to $18,000 per annum.

The prime minister said Vincentians have also seen reductions in company taxes.

“All these are matters of record,” said Gonsalves.

He also used the opportunity to deal with the issue of Value Added Tax (VAT).

“The consumption tax at the port was higher than VAT. The VAT is 15 and the Consumption Tax is 99 per cent of the commodities. We have zero rated or exempted a whole set of goods and services and certainly basic foods and personal hygienic products,” said Gonsalves.

Gonsalves said it was unfortunate that VAT was introduced in May 2007 when there was an increase in commodity prices.

“The Opposition, as oppositions would be wont to do, said the reason why the prices increased is because of the VAT when in fact I have demonstrated …to show you that those which are zero rated, the price increases were higher and the only answer to be found is in the increase in commodity prices internationally …and of course to a lesser degree some gouging,” said Gonsalves.

He refuted claims that his administration has been increasing the tax burden on Vincentians. (HN)