How is Eustace going to ‘make good’ this loss of taxable revenue?

Editor: I refer to an article on page 15 of your issue of 30/10.

This reported a statement by Mr Eustace that, if elected, the NDP would remove VAT from 140 articles now being liable to this charge. If taken on face value, this is quite an attractive claim.

However, if one considers this statement in more depth, then it creates more questions than answers.{{more}}

I may not be considered an economist of Mr Eustace’s stature, but I can add and subtract and have a modicum of common sense. This attribute of common sense leads me to ask the following questions.

It is a matter of fact that the only revenue(s) that any Government anywhere in the world receives are (for the most part) collected in either taxes or levies.

Thus the collection of such taxes contribute to the overall budget of the nation and the benefit of the populace, via a health service, road repairs, education and all other social services provided by the governing party.

Therefore, if these 140 items were taken from the VAT register and became exempt or zero rated there would be a loss of revenue to the treasury of SVG.

It was reported that Mr Eustace said that in 2014 the Government collected $75 million from VAT. This, of course, includes VAT payments levied against all of the 140 items that Mr Eustace now wishes to remove. If Mr Eustace has considered his statement fully, he should be able to detail what proportion of this tax revenue these 140 items contributed to his stated figure of $75 million.

In effect, I am asking him to clarify his statement and advise the populace how much the treasury here in SVG will lose in revenue owing to the lifting of the VAT charge on these specific 140 items.

Having made that (loss) figure available I would then ask him to explain how he is going to “make good” this loss of taxable revenue. The only viable alternative that comes to my mind is the raising of all other taxes to compensate for this loss, together with, perhaps, other cuts in items such as health, social service and public service staffing.

In effect then, he is giving with one hand and taking (perhaps more) with the other (or more probable, just making what he hopes will be an election winning statement).

To close, this matter of VAT de-registration was mentioned in the New Times phone-in programme by Mr Leacock and Mr Cummings just prior to the last election held in 2010. Again these gentlemen mentioned a profusion of items that would be made VAT exempt should the NDP win the then, forthcoming election.

I was able to phone in and ask both of these gentlemen the same questions that I have posed to Mr Eustace above. Neither of these gentlemen was able to answer either point and resorted to personal insults towards me to cover their lack of forethought and fiscal knowledge regarding their utterances..

I would hope for a more succinct and productive reply from, Mr Eustace.

A W Indupp