Gail Alexan­der

The PNM's 2016 bud­get of de­cep­tive fig­ures will place fi­nan­cial pain on the poor, mid­dle class, work­ers, small and medi­um busi­ness­es and every­one to whom costs are be­ing passed on, Op­po­si­tion Leader Kam­la Per­sad-Bisses­sar warned yes­ter­day.

De­liv­er­ing the first bud­get re­ply in her new po­si­tion as Op­po­si­tion Leader, Per­sad-Bisses­sar added in Par­lia­ment yes­ter­day, "This bud­get ap­pears de­signed to pun­ish the poor and a vast ma­jor­i­ty of cit­i­zens ... to cre­ate fi­nan­cial hard­ship among those least able to man­age it. The (Fi­nance) Min­is­ter speaks of shar­ing the bur­den, even unions joined the PNM's cho­rus of the need to share the bur­den. In re­al­i­ty, it's on­ly the low­er and mid­dle in­come who are shar­ing this bur­den. The de­cep­tion is in the num­bers. The dev­il is in the fig­ures."

"The PNM has giv­en T&T half a bud­get, cost­ing $63 bil­lion with a deficit of $21 bil­lion dol­lars and, in the same breath talk­ing fis­cal dis­ci­pline, then they tell us the re­al bud­get will come next March...when the IMF ar­rives? So, cit­i­zens: hold your breath as you wait to ex­hale when the re­al bud­get comes.

"These 2015 num­bers are de­bat­able. We'll on­ly know the re­al num­bers some months from now, (but) the facts and fig­ures will drown out the de­cep­tion," she said.

Per­sad-Bisses­sar faced con­tin­u­ous ha­rangu­ing from PNM mem­bers at the start of her speech. House Speak­er Bridgid An­nisette-George had to call for or­der nu­mer­ous times dur­ing Per­sad-Bisses­sar's two-hour ad­dress. An­nisette-George at one point had to tell Fi­nance Min­is­ter Colm Im­bert she was hear­ing him.

Say­ing there were many de­cep­tive el­e­ments in the bud­get, Per­sad-Bisses­sar said Im­bert's pre­sen­ta­tion lacked con­text in his ac­cu­sa­tion of PP eco­nom­ic "mis­man­age­ment."

She be­gan her ad­dress de­tail­ing and de­fend­ing the PP's eco­nom­ic han­dling, deny­ing wastage and ex­plain­ing gov­ern­ment's over­draft with the Cen­tral Bank.

On bud­get im­pli­ca­tions, Per­sad-Bisses­sar said the per­son­al al­lowance in­crease worked out to al­low­ing in­di­vid­u­als $250 more month­ly, "or the prince­ly sum of $8 per day, these days that can't even buy two dou­bles."

Ad­di­tion­al­ly, the VAT mea­sures and fu­el costs negat­ed any ben­e­fit cit­i­zens would have re­ceived from this, she added.

Per­sad-Bisses­sar ques­tioned who would ben­e­fit from a re­duc­tion of VAT from 15 to 12.5 per cent.

She said, "Al­ready the items de­scribed as es­sen­tials: food­stuff, med­ica­tion, etc, are VAT free. So it's more like­ly per­sons in­volved in the pur­chase of lux­u­ries will ben­e­fit.

"The sit­u­a­tion is more de­cep­tion: what the min­is­ter is re­al­ly of­fer­ing T&T is an in­crease in the mon­ey every per­son spends on VAT, be­cause the vul­ner­a­ble, poor, the sin­gle-par­ent house­holds, the el­der­ly, those most in need are now go­ing to be pe­nalised by hav­ing to pay VAT on a se­cret wide range of goods which pre­vi­ous­ly had no VAT."

She said the PP re­moved VAT on all food items, but re­tained it on lux­u­ries and al­co­hol.

"The PNM Gov­ern­ment is seek­ing to un­do that not on­ly by rais­ing the prices of food and oth­er items on their se­cret list by 12.5 per cent. But prices will es­ca­late by sub­stan­tial­ly more than 12.5 per cent as a di­rect con­se­quence of this."

Per­sad-Bisses­sar added, "The min­is­ter glossed over that the av­er­age cit­i­zen will have to pay more for food and ba­sics.

"He al­ready knows what items will be VAT­able be­cause he was able to cal­cu­late what the tax re­turns. Which foods is he tax­ing? Cof­fee? Sar­dines? Ghee? Cur­ry? Corned beef? Crix? Ketchup? Cook­ing oil?"

She not­ed VAT-free items in­clud­ed phar­ma­ceu­ti­cals, steel­band equip­ment, agri­cul­tur­al and en­er­gy sec­tor in­puts, books, rental prop­er­ties, com­mu­ni­ca­tion and sports in­puts.

"The mul­ti­pli­er ef­fect of this mea­sure on these is a ret­ro­grade step, with in­fla­tion­ary reper­cus­sions," she said.

Per­sad-Bisses­sar ques­tioned Im­bert's in­di­ca­tion that widen­ing of the VAT base would yield $4 bil­lion from cit­i­zens since bud­get rev­enue doc­u­ments show 2016 VAT col­lec­tion of $12 bil­lion. "He's mis­led us with the $4 bil­lion fig­ure and needs to ex­plain how you get dou­ble rev­enue if you re­duce VAT."

The ef­fect of in­creas­ing the thresh­old for VAT to $500,000 al­so means an in­crease in the cost of do­ing busi­ness, she not­ed.

"Par­tic­u­lar­ly for small busi­ness­es and new start-ups, as they would be un­able to claim their in­put VAT through the sys­tem. This doesn't af­fect big busi­ness­es. But when this is tied to the Busi­ness and Green Fund Levy in­creas­es in the bud­get, it's a triple wham­my against small and mi­cro-en­ter­prise busi­ness­es.

"Every par­lour will feel this, every small re­tail out­let, every­one seek­ing to open new busi­ness...un­less you're a big busi­ness­man in which case you'd cross the lim­it and be able to re­claim VAT."

Levy will bring strife

Per­sad-Bisses­sar said the 200 per cent Busi­ness Levy in­crease would in­crease the tax li­a­bil­i­ty of those busi­ness­es al­ready mak­ing a loss/neg­li­gi­ble prof­it.

"In the cur­rent eco­nom­ic cli­mate with ris­ing cost of do­ing busi­ness, falling rev­enues and prof­its, this pe­nalis­es small-medi­um busi­ness­es and may con­tribute to them go­ing out of busi­ness–an­oth­er penal­ty for small busi­ness."

Per­sad-Bisses­sar said the PNM, in rais­ing this tax, ap­peared to recog­nise the ad­verse ef­fect the bud­get would have on such busi­ness­es.

"How else does one ex­plain that with an av­er­age of $219.3 mil­lion in rev­enue from the Busi­ness Levy be­tween 2010 to 2015, he rais­es the tax by 200 per cent but the ac­tu­al in­crease in rev­enue pro­ject­ed isn't a com­men­su­rate 200 per cent but 175 per cent of that? Is it that more small/medi­um busi­ness­es will sim­ply close?"

She echoed sim­i­lar con­cerns re­gard­ing the Green Fund Levy.

"And it's ob­vi­ous these costs will be passed to the con­sumer via high­er prices."

Per­sad-Bisses­sar said de­spite the PNM's "crown jew­el," that is, the "$10 bil­lion Na­tion­al Se­cu­ri­ty al­lo­ca­tion, analy­sis showed the fund­ing hike was for ex­pense for the com­bi­na­tion of Jus­tice and oth­er port­fo­lios with Na­tion­al Se­cu­ri­ty and has noth­ing to do with crime-fight­ing ini­tia­tives. ...Hoax or de­cep­tion. 'Plen­ty' mon­ey for Na­tion­al Se­cu­ri­ty, but lit­tle to fight crime."

Per­sad-Bisses­sar queried the fact that the prop­er­ty tax wasn't list­ed un­der "land and build­ing tax" or the prop­er­ty tax the PNM had passed, but un­der "a strange new head­ing–In­dus­tri­al Land Tax."

She said Im­bert had de­liv­ered a con­tra­dic­to­ry bud­get state­ment seek­ing to con­tin­ue the ad­ver­sar­i­al elec­tion cam­paign "not to unite our peo­ple for the nec­es­sary ad­just­ment or the change in think­ing...he ap­pears to be set­ting the stage for when his plans fail by plac­ing his re­spon­si­bil­i­ty on the pri­vate sec­tor's shoul­der when he says eco­nom­ic re­cov­ery will de­pend crit­i­cal­ly on that sec­tor's re­ac­tion.

"(But) there's lit­tle in the bud­get to gen­er­ate busi­ness con­fi­dence, mo­ti­vate sig­nif­i­cant in­vest­ment and noth­ing to ease the labour short­age and im­prove pro­duc­tiv­i­ty."

Slam­ming Im­bert's "Let's Do This To­geth­er" call, she added, "It's a be­tray­al to ask every­one to do this to­geth­er and then alien­ate so many by brand­ing them guilty of malfea­sance and be­tray­al when an as­sur­ance is giv­en there will be no job loss, yet dai­ly we read about more and more job loss­es.

"Bud­get state­ments show the new Gov­ern­ment more con­cerned with scor­ing po­lit­i­cal points than deal­ing with T&T's fun­da­men­tal prob­lems."

Per­sad-Bisses­sar warned the glob­al econ­o­my re­mained caught in the dol­drums.

"It's im­por­tant that ac­tions that could re­sult in fur­ther eco­nom­ic con­trac­tion are avoid­ed and ef­forts are made to mit­i­gate the ef­fect of the re­struc­tur­ing that must take place, and its ef­fects on the poor in our coun­try. Un­for­tu­nate­ly the bud­get's po­si­tions give lit­tle hope that the cur­rent Gov­ern­ment un­der­stands the prob­lem or have pol­i­cy pre­scrip­tions they can of­fer."

She con­clud­ed, "The last time I made a bud­get con­tri­bu­tion, a PNM MP dis­missed it as 'ar­rant non­sense and fool­ish­ness' and while I wouldn't say his bud­get speech was that, there are many who've said his speech was ex­act­ly that."