Prime Minister Hon Philip J. Pierre read a statement on the Draft Tax Administration and Procedure Act Friday to kick off a press conference on the subject.
Pierre said, “Thank you for joining me today as we address concerns circulating regarding the Draft Tax Administration and Procedure Act that has garnered attention. It is imperative that we always provide accurate information to the St Lucian public, to dispel any misconceptions.
First and foremost, I want to make it clear that the draft bill in circulation was initiated during the term of the UWP administration as evidenced by Cabinet Conclusion No. 1511 of 2020. The Cabinet Conclusion reads:
‘Cabinet considered a Memorandum dated 13th November, 2020, submitted by the Department of Finance and approved the request for creation of the Tax Administration and Procedures Act to harmonize the administrative, collections and penal provisions, of the various pieces of legislation that are currently administered by the Inland Revenue Department’.
Further by Memo dated December 3rd, 2020 from the Ministry of Finance, Economic Growth, Job Creation, External Affairs and Public Service headed by the former Prime Minister states:
‘The Department of Finance wishes to inform that Cabinet by Conclusion no. 1511 of 2020 considered a memorandum dated 13th November 2020, submitted by the Department of Finance and approved the request for creation of the Tax Administrative Procedures Act to harmonize the administrative, collections and penal provisions, of the various pieces of legislation that are currently administered by the Inland Revenue Department. The aforementioned is for your attention and necessary action.’
It is clear that instructions for preparation of the draft bill came from the former Minister of Finance. Let me inform the public of Saint Lucia that the cabinet which I lead has never seen the draft bill now in circulation.
It is my understanding that consistent with our approach of transparency, dialogue and open government the draft bill prepared on instruction of the former prime minister is open for public discussion.
My government policy on tax is clear. We have increased the threshold to $25,500. Anyone who earns less than $25,000.00 annually pays no income tax.
My government has given the most generous tax amnesty in the history of Saint Lucia, where all forms of fines, penalties and interest have been cancelled on all outstanding tax arrears including VAT.
It is commendable that civil society is discussing the draft bill now in circulation, which will no doubt lead to the presentation to Cabinet of a discussed document.
I urge the public, to take the opportunity to settle their outstanding taxes by May 2024.”
Answering a question during the press conference, Pierre said, “The important point is that the instruction to prepare the bill came from the former government. After that, it’s procedural… What happens after that, based on instructions, Inland Revenue proceeded to prepare a bill, which according to the instruction, it says to ‘harmonize the administrative, collections and penal provisions, of the various pieces of legislation.’ After it is prepared by the technical people, it is circulated and then it comes to the Cabinet. The Cabinet opines, discusses, and it goes to the Attorney General for necessary changes and then it goes to the Parliament. Anything before that, it’s just a piece of paper.”
Reacting to Pierre’s statements, former Prime Minister and current Opposition Leader Hon Allen Chastanet posted to Facebook saying, “During Monday’s Cabinet Press Briefing, Prime Minister Philip J Pierre confirmed that he was taking a $40 Million dollar loan to strengthen Inland Revenue’s ability to collect taxes. Today he is blaming me for his Government’s attempt to seize your home and prevent you from traveling if you haven’t paid your taxes.
Has he forgotten that he has been the Prime Minister for the last 2.5 Years? What an embarrassment!”
In a press statement released on Thursday, the United Workers Party (UWP) expressed “strong objection to the recent proposal by the Government of Saint Lucia outlining harsh measures for individuals and businesses with outstanding tax payments. The UWP firmly believes that a highly punitive approach to tax collection of taxes is counterproductive and advocates for fair and efficient methods that promote tax compliance without compromising individual rights.
The statement continued, “First, the Government’s intention to double the penalty interest rate from 10% to a staggering 20% is excessive and unreasonable. This hike in the interest rate can have a devastating impact on individuals and businesses already grappling with the challenges of the current economic climate. Rather than unreasonable and unfair interest rates, the government should reduce the opportunities for noncompliance so that penalties rarely need to be applied.
Equally troubling is the proposal to grant the Comptroller of Inland Revenue the authority to seize assets, including homes, to recover unpaid taxes. This measure is draconian and disproportionate, potentially leading to scenarios where families could lose their homes due to unpaid tax liabilities. This policy not only creates fear and uncertainty, but also jeopardizes the overall economic stability of our nation.
Furthermore, the requirement for individuals owing taxes to obtain permission to travel is an unprecedented encroachment on personal freedoms. This policy is not only an infringement upon the right to freedom of movement but also places an unnecessary bureaucratic burden on citizens.
The UWP believes in fair and efficient tax collection methods that support the development of the country while respecting the rights and dignities of its citizens. We urge the Government to reconsider these harsh measures and engage in a more consultative process with stakeholders to find balanced solutions that improve tax compliance without resorting to punitive and oppressive tactics.
We stand with the people of Saint Lucia in advocating for fair and just governance, and we will continue to voice our concerns against any measures that threaten fundamental liberties and the welfare of our citizens.”
