(Trinidad Express) Rich folks, get ready to pay more.
Finance Minister Colm Imbert announced during the reading of the 2016-2017 Budget yesterday that anyone making over $1 million in income annually will pay a 30 per cent personal tax.
Those making less than $1 million will continue to pay a 25 per cent tax.
And companies making $1 million in profit annually will also be subject to a high tax bracket.
The new millionaire tax is expected to earn the country an additional $60 million in revenue.
And the additional tax on the million dollar business will earn the country an estimate $500 million says Imbert who delivered his statement in the Parliament in Port of Spain on Friday afternoon.
“We must ways and means of closing the fiscal gap”, he said.
Imbert said that in 2017, core revenue defined essentially as revenue from taxation, royalties and customs duties, is projected to be of the order of $37 billion, $20 billion less than two years ago.
This leaves a fiscal gap in 2017 of over $16 billion which must be financed by a combination of borrowings and drawdowns from the Heritage and Stabilisation Fund and one of sources of income such as a sale of assets, dividends from State enterprises, lending such as from the Clico bailout.
Imbert said that new sources of sustainable revenue and savings in transfers and subsidies must also be identified to help bridge the gap.
Among the proposed fiscal measures
– The Property Tax will be implemented in 2017 based on 2009 rates. Exemptions will be based on inability to pay.
-In keeping with our diversification trust, the maritime industry is being targeted for boat. He proposed to make foreign yacht repair services, a VAT exempt service for yacht owners. This in keeping with international best practice and will take effect in the first quarter of 2017.
– The completion the legislative requirements and move to establish a Revenue Authority in 2017. Having already strengthened the administrative processes at the Board of Inland Revenue (BIR) and the Customs and Excise Division at the Ministry of Finance, the Authority will allow for a greater transfer of information between the BIR and the Customs.
– It is estimated that in the first year, revenue effect of the Revenue Authority as it starts to be in excess of $100 million per year, rising exponentially thereafter.
– It has been estimated that since 2011 Trinidad and Tobago has lost at least US $1.4 billion dollars per annum in reduced benefits as a result of the diversion of natural gas sales to higher priced markets.
