BY NOW, no one doubts the very parlous state of the Barbados economy.
It is for that reason some Barbadians would applaud almost any Government initiative to raise revenue even though it may call for greater sacrifices than they have had to endure in the past eight years.
That is why every civic-minded person would welcome the attempt to use the still embryonic Barbados Revenue Authority (BRA) legislation to close a few loopholes and “encourage” delinquent taxpayers, tax avoiders and tax evaders all, to fulfil their obligations to the state.
On the surface, the Barbados Revenue Authority (Amendment) Bill 2017, passed in the House of Assembly on February 14, and expected to be taken to the Senate, would appear to be an innocuous or relatively harmless addition to the tax collection bow.
The stated intent is the issuance of tax clearance certificates by BRA once it is satisfied that no taxes are due under taxing acts; all taxes, interest and penalties accrued under those acts have been paid; or an amount equal to ten per cent has been paid and an agreement reached to make scheduled payments to liquidate what is owed.
There is a particular provision on the conveyance of land which includes the above stipulations but adds the repayment of all input tax previously allowed under the VAT Act.
But it appears that as has been the experience with such measures, the clichéd devil is in the details, and the amendment, if enacted, may impact the lives and livelihoods of Barbadians in ways not intended.
Or was it?
Did Government, in seeking to raise desperately needed revenue, not see or anticipate the restraint such a law could place on the pursuit of their professions by people and the other law-abiding citizens going after their daily bread?
To its credit, the official Opposition red-flagged some of the more pernicious implications of the proposal: not only hurting people’s inability to realise their cherished dream of owning land, but also of disposing of it in times of dire need, along with adding another obstacle to the ease of doing business goal.
The Barbados Bar Association, in one of its rare interventions in policymaking debates, also expressed its concerns, suggesting it could have “constitutional implications” and “would cause more mischief than it cures”.
On conveyance, for example, the Association said other than the Land Tax Act, taxes due and payable under the other Acts were not charges on land, “and ought not to be treated as such”.
“The requirement of the tax clearance certificate contemplated by the amendment seeks to treat debts owed to the Crown as first charges on land,” it added. “It is unclear what mischief this provision seeks to address and whether in its current form it addressed any mischief relative to the transfer of property.”
In addition, it noted the amendment failed to make provision “for the set off of refunds against tax assessed” similar to that provided in the VAT Act, and sought to “make liable for unpaid taxes third parties to whom those taxes do not relate”.
It is not immediately clear from a cursory reading just how far and restraints and restrictions may be taken.
What is known is the experience of other countries where while seeking to “encourage” their people to pay up, authorities used the legislation against real and imagined political opponents.
In Trinidad and Tobago, for example, tax clearances caused havoc in the corporate community, especially among small businesses, where buyers could not travel to shop, and in the wider community, among people who simply wanted a few days or weeks holiday.
Its abolition, in 1995, was said to have removed a sizeable and costly administrative machinery from the Ministry of Finance.
In Guyana, concerns have been raised about the recent reintroduction of similar legislation which opponents said had been used with telling effect against political enemies during the Burnham years, but was abandoned by Desmond Hoyte.
Now, warnings are going up about a possible increase in corruption involving people paying to get their tax clearances in order to travel.
Back home, in the House, Government appeared to ignore or just rejected the Opposition’s call for the bill to be sent to a Select Committee for further consideration when the apparent restrictive provisions might have been thoroughly debated.
There has been an unusual gap, in a matter of such urgency, between the House debate and the bill’s appearance in the Senate, and as of Friday, it had not been tabled.
The Senate, which I still think should be abolished, has an opportune moment to prove itself as a mature review body and its members act in the interest of the people and not just those who appointed them.
Albert Brandford is an independent political correspondent. Email [email protected]
