A Government Budget of EC$139.46 million to finance the island’s public services during 2006 has been introduced in the Anguilla House of Assembly, which carries the formal name of the Atlin Harrigan OBE Parliamentary Building.

Hon. Victor Banks with Budget Address

The Assembly, presided over by Speaker David Carty, heard from Minister of Finance, Victor Banks, that there will be increases in taxes and fees, including vehicle licences, to support the budget. The Minister said in his address on Tuesday, December 13: “The Revenue Budget is cast against realistic projections in revenue under a number of subheads and increases in Licence Fees and charges and several new taxes measures affecting specific sectors.”

Mr. Banks noted that the Government was expected to spend $124.99 million in 2006, an increase from $98 million in 2005 by 26.99 million or 27%. This would result in a surplus of $14.47 million. The 2006 Capital Budget has been estimated at $23.43 million.

Mr. Banks said there would be increases in collections of Work Permit Fees, Accommodation Tax, Environmental Levy, Bank Deposit Levy and Import Licence for blocks and cement. He observed that the money to be derived was “not reflective of any increase in these tax measures but rather of economic growth and improved collection.”

The following excerpt from Mr. Banks’ Budget Address puts the planned new taxes and fees into perspective:
“In terms of increased rates, Government has approved an increase in motor vehicle licences by an average of 25% from January 1, 2006. This is expected to yield about $1.0 million in additional revenues. The direct beneficiaries will be the road users who will benefit from a greater decrease in vehicle operating cost because of the better roads that are being built. It should be noted here Mr. Speaker that over $8.0 million will be spent on road development during 2006 from the Capital Budget and more than $1.0 on road maintenance through the recurrent vote under the Ministry of Infrastructure. A similar investment was made in 2005and 2004.

“Landing Fees at the Airport will be increased by an average of 50% from January 1, 2006. This will bring them in line with what is charged in the neighbouring islands. With this increase LIAT and Caribbean Star will now be paying $90.00 per landing for the smaller Dash 8 instead of the current charge of $60.00. The larger Dash 8 will pay $120.00 instead of $80.00. Air Navigational Facility Charges will be increased from $10.00 and $15.00 per landing to $15.00 and $25.00.

Invited guests at the House of Assembly

“In addition to the Landing Fees, a Noise Pollution Charge of EC$100.00 per aircraft operating with jet propulsion will be charged from January 1, 2006. Aircraft powered by propellers will not pay this charge.

“Mr. Speaker, work is in hand to commence the collection of a Residential Asset Levy in 2006 for all residential components included the new tourism resort/residential projects such as the Temenos-St. Regis Anguilla project and the Viceroy Anguilla project. The levies were agreed as part of the investment agreements signed with the developers of these projects. They will be paid by the owners of the estate residencies, villas and condominium units included in such projects.

“Another measure to be introduced in 2006 will be the Tourism Marketing Level. This will involve legislation establishing a charge of US$ 1.00 per day to be paid per visitor spending one or more nights on Anguilla. Owners/Operators of the various tourism accommodations will be required to match the payments by visitors and will be responsible for collecting and paying the revenue to the Government. The Tourist Board and the Anguilla Hotel and Tourism Association attempted this as a voluntary programme and met with only limited success. All tourism facilities will be required to implement this measure from January 1, 2006.

“Mr. Speaker as from January 2006, Business Licences will be increased on an average by 20%. In addition, the Business Licence categories will be expanded to include businesses and professions that were not categoriszed separately in the previous legislation. In return, the businesses and professions on Anguilla can expect more business facilitation and some of the increased business licence collections will be used to finance the work of the Anguilla Chamber of Commerce and Industry (ACOCI).

“A cooperation agreement will be signed between the Government and the Chamber and all businesses that pay their licience fees will automatically become paid up members of the Chamber with the exception of businesses licenced under separate laws from the Trades and Business Occupations and Professions Licencing Act. Provision will also be made for businesses that are majority owned by non-Belongers to pay the licence fee plus 50%. The fees payable by businesses undertaking several related activities will be reduced in respect of the secondary activities by 50%.

“Finally, Mr. Speaker, even though no figure has been budgeted, National Health Insurance is scheduled to be introduced from July 1, 2006. Associated with this will be the introduction of a Social Security Levy. With this introduction, workers and other income earners will be required to contribute a small percentage of their salaries or wages into a fund to finance Health Insurance and Social Services. With the National Insurance Fund, all insured persons including the elderly and indigent, will be entitled to a basic package of medical services. From January 2006, the Ministry of Social Development will begin to explain what all Anguillians can expect with the introduction of this programme through a period of extensive public consultations.”

Invited guests at the House of Assembly

At the end of those statements, Mr. Banks expressed his view that the revenue target of $139.46 was achievable, noting however that it depended on a number of factors. “One of them is the avoidance of shocks to our fragile tourism industry,” he cautioned. “We have been lucky during the 2005 Hurricane Season and hope that this will continue into the foreseeable future. We also have to keep crime at a low rate and improve productivity in both the public and private sectors. The revenue target includes provision for meeting the targeted level of reserves and to part fund the capital expenditure.”

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