Philipsburg – Certain Members of Parliament behave as if commenting on the budget is an earned right and that if organizations or individuals don’t meet certain randomly set criteria, then they don’t have the right to comment on the budget. Instead of having a discussion about the contents of SHTA’s comments, some Members of Parliament have chosen to attack the messenger, sending a clear message to many in the community to be careful when speaking out.
The SHTA was simply following the recommendations of the Prime Minister and by the President of Parliament made at SHTA’s Membership Mixer last February, about the dual layer of government, that we study the budget and use it as a basis for commenting on the plans and priorities of government. To, at this point, attack an organization that offers a differing point of view is simply contrary the principles of democratic governance.
The SHTA, the largest private business representative on the island whose members cover a broad range of industries including amongst others: the hotel, restaurant, catering and entertainment industry, wholesalers, retailers, real estate, marine trade, financial and legal services, taxi associations, car rentals, construction companies, and environmental organizations, has been objective and open to dialogue with all of the governments, past and present. Nevertheless, in representing our members, we are sometimes critical of any present government.
The SHTA does not see its role as interfering in the enforcement of laws and regulations in St. Maarten, but rather it’s the role of Parliament to ensure, through the instructions to its ministries, rules and regulations are properly adhered to by all. The SHTA has always refrained from commenting on specific is cases which is why SHTA has not commented on the ORCA investigation, MP Laveist’s conviction, the Pelican issue, etc. If the Members of Parliament believe SHTA should police its own members, perhaps the Members of Parliament can lead by example.
According to MP Frans Richardson, the waiving of collecting of taxes prior to year 2006, is already relief for SHTA’s members. SHTA has never condoned the waiving of tax obligations for individual companies. Its understanding was that government ledgers were and are clogged with unrealistic and erroneous assessments and that the Department of Finance was going to waive taxes from before 2006 because they were either uncollectable or inaccurate.
The waiving of real tax obligations is unfair to those companies that have indeed complied with all of their tax obligations. If real tax obligations are being forgiven as mentioned above, this only reinforces the perception that if you comply with the law you are punished and if you break the law you are rewarded. The SHTA has always advocated for the fair and uniform application of laws and that sporadic and selective enforcement of the laws is unfair.
The SHTA has commented on several occasions that the current tax system should shift from direct taxation to indirect taxation improving compliance, advocating that by broadening of the tax base, the overall tax burden could be reduced. Prior to the inception of the Turnover Tax in 1998, SHTA has been condoning this tax as damaging to our economy due to its cumulative nature. In 2010, 2011 and 2012, SHTA warned about the possible ramifications an increase in the Turn Over Tax could have, making reference to numerous press releases in 2010, 2011, and 2012, featured in both the Today and the Daily Herald newspapers, including the SHTA’s response to the increase from 3% to 5%.
Last September when there were rumors of yet another increase in the turnover tax, the SHTA was assured by the Minister of Finance that there would be no increase in TOT, see article in The Today of September 13, 2012 “Tuitt No Hike in TOT”.
With regard to tax compliance, SHTA has always encouraged its members to comply with all laws and regulations. If the Members of Parliament are aware of businesses that aren’t complying with law, they should deal with it accordingly. If anything, the SHTA believes that its members are being targeted by extra audits and controls. Again, the SHTA believes that broadening of the tax base and improved compliance should allow the overall tax burden to be reduced.
The SHTA urges the Members of Parliament to get back to the business at hand of discussing the draft 2013 budget. These discussions should have taken place last September, not six months later. We, the SHTA, just like all the taxpayers on St. Maarten, feel that we have the right to know and should have a say in how the Government of St. Maarten will be spending our hard-earned money, as all policy seems to be lacking from this budget.
Last but not least, and this may be the most important issue the SHTA has with this budget, is the fact that the 2013 draft budget currently being discussed is not based on the actual financial statements of 2012. As far as the SHTA has been informed and we hoped that this information is incorrect, that to date, the actual financial information for 2011 and 2010 has not even been finalized.
A budget should, according to general accounting practices, be based on actual financial information of the previous year but not on merely the budget of the previous year. Especially, a 2012 budget of which no one knows as yet how it compares to real expenditures and income.
Thus this raises the questions whether this draft should even be considered or whether we should maybe continue to use the 2012 budget and then make sure we have all the necessary figures in order to compile the 2014 budget, in a manner that is in the best interest of our country.
The SHTA is dedicated to bringing quality to all aspects of life on St. Maarten by promoting sustainable economic development for its members in cooperation with the social partners and the creation of a fair marketplace. For more information please contact our offices at 542-0108 or visit our website at www.shta.com.