TAX MEASURES TO SUPPORT 2003 BUGET

Anguilla’s Minister of Finance and Economic Development, Victor Banks, on Tuesday December 10, introduced into the House of Assembly a Recurrent Expenditure budget of 89 million East Caribbean dollars to finance the Government’ services for 2003. The Recurrent Revenue budget has been established at $92.1m, showing a revenue surplus of $3.1m.

The Minister noted in his Budget Address, under the theme “Being Effective Stewards Today,” that difficult as it was, the easier part of the budget was to decide on expenditure. “The real challenge is to raise the revenue to finance the expenditures and to take the tough decisions in this regard in a community in which anti-tax sentiments are among the highest in the world,” he observed.

Mr. Banks went on: “It has been a great challenge to decide from among the various proposals and options on those measures that should be implemented in 2003 to increase the efficiency of collection from existing taxes, licences, fees and charges as well as to adjust existing levels and introduce new measures to raise additional revenue.”

He disclosed that a number of fees which had not been increased in over 40 years would be brought up to their economic cost. Other fees are to be adjusted in line with inflation and other economic conditions. Pier Dues, Tonnage Dues, Port Dues, Telecommunications Fees and Court Fees are among the areas to be affected by the revenue-raising measures.

Mr. Banks continued: “Consideration has been given to increasing the yield from Property Tax. The Task Force has been working with the Lands and Surveys Department to ensure that all properties are on the register and has been sensitizing the public on the need to pay Property Tax. This is already bearing fruit with an increased yield from existing properties. During the course of 2003, Property Tax values and rates will be reviewed with a view to substantially improving the yield from this tax as of January 1, 2004. Accordingly the necessary amendments to the property tax legislation and regulations will be made during the year.”

The Minister of Finance further disclosed that with effect from January 1, 2003, an Environmental Levy would be introduced. It will be collected by the Anguilla Electricity Company on behalf of the Government with the payment of electricity bills. He said the tax will be at the rate of 5% of the electricity bill of each household or business. This will provide for a minimum collection of $5.00, amounting to $1.5 million in 2003. He noted that this amounted to a fraction of the over $2 million expected to be spent on maintaining a sustainable environment.

According to Mr. Banks, an additional one percent duty will be charged on the CIF value of all imported items “carrying an ad valorem rate.” He stated that it would be a temporary measure which would be reviewed following the restoration of fiscal stability. He added that the revenue yield from this measure would amount to an estimated $2.3 million.

Further information on the budget will be given later. Meanwhile, the debate in the Anguilla House of Assembly will commence on Monday December 16.

Hon. Victor Banks