Gail Alexan­der

The pro­posed T&T Rev­enue Au­thor­i­ty, which is need­ed in the cur­rent eco­nom­ic “gua­va sea­son,” will have an En­force­ment Di­vi­sion staffed by pub­lic of­fi­cers ap­point­ed by the Pub­lic Ser­vice Com­mis­sion– not politi­cians.

Fi­nance Min­is­ter Colm Im­bert con­firmed that in the Sen­ate yes­ter­day while pi­lot­ing a bill to es­tab­lish the au­thor­i­ty.

Its func­tions will in­clude as­sess­ment and col­lec­tion of tax­es un­der rev­enue laws, en­force­ment of bor­der con­trol mea­sures and a com­bi­na­tion of the func­tions cur­rent­ly held by the In­land Rev­enue Di­vi­sion and Cus­toms and Ex­cise Di­vi­sion.

The TTRA is geared to­wards mak­ing the tax regime more ef­fi­cient and en­hanc­ing tax­pay­er com­pli­ance.

The bill for the TTRA, af­ter 11 years of ef­fort and fail­ing due to lack of Op­po­si­tion sup­port, will on­ly re­quire a sim­ple ma­jor­i­ty vote for pas­sage. It had pre­vi­ous­ly re­quired a spe­cial ma­jor­i­ty vote and Op­po­si­tion sup­port.

Im­bert said, “De­spite the well doc­u­ment­ed ben­e­fits that re­dound by way of es­tab­lish­ing a Rev­enue Au­thor­i­ty, the Op­po­si­tion has re­solved they will not sup­port a Rev­enue Au­thor­i­ty. As a re­sult, Gov­ern­ment pro­posed a so­lu­tion to end this dead­lock that is seam­less, el­e­gant and in keep­ing with the rule of law.”

He said this in­volved ad­just­ing the bill and es­tab­lish­ing the En­force­ment Di­vi­sion staffed by pub­lic of­fi­cers. As a re­sult, the bill doesn’t in­fringe con­sti­tu­tion­al claus­es.

He said in­clu­sion of the En­force­ment Di­vi­sion and pub­lic of­fi­cers will ad­dress con­cerns raised by naysay­ers, in­clud­ing con­cerns of politi­ci­sa­tion of TTRA and po­lit­i­cal abuse.

On why the TTRA was need­ed, Im­bert de­tailed in­ef­fi­cien­cies of the cur­rent sys­tem cit­ed by In­ter­na­tion­al Mon­e­tary Fund stud­ies and the Ox­ford Busi­ness Group and World Bank.

The IMF, in 2019, in­di­cat­ed there was a VAT gap of around five per cent of GDP, which con­sist­ed of the com­pli­ance gap and pol­i­cy gap. He said com­pli­ance is the prob­lem and that gap is about two to three per cent - es­ti­mat­ed to be worth $3 bil­lion to $5 bil­lion per year with VAT.

The TTRA is al­so need­ed in the“ gua­va sea­son,” where there’s sig­nif­i­cant dam­age from the glob­al pan­dem­ic, he added.

Col­lec­tions due to TTRA es­tab­lish­ment and oth­er tax ef­fi­cien­cy gains will en­sure rev­enue col­lec­tion is ap­proached as a “world class busi­ness.”

It’s pro­ject­ed to re­sult in in­creased col­lec­tions rang­ing from 1 per cent of GDP in 2022 ($1.5 bil­lion) to two per cent in 2024 ($3.2 bil­lion).

Im­bert said TTRA sys­tems will pre­vent tax­pay­ers wait­ing in long lines and be­ing frus­trat­ed in seek­ing in­for­ma­tion clar­i­fi­ca­tion. He said Gov­ern­ment hoped and prayed the bill would find favour with ma­jor­i­ty of Sen­a­tors.

He said, “This is re­al­ly need­ed at this time with our very dif­fi­cult rev­enue sit­u­a­tion and the call on the Trea­sury for un­prece­dent­ed ex­pen­di­ture on the health sec­tor to deal with the pan­dem­ic and oth­er calls on the Trea­sury to pro­vide fi­nan­cial as­sis­tance to those af­fect­ed.

“I don’t think we can con­tin­ue in the cur­rent sit­u­a­tion ... with our high­ly and gross­ly in­ef­fi­cient sys­tem that lends it­self to in­ter­fer­ence and a cul­ture of tax avoid­ance and pun­ish­es mem­bers of the pub­lic who are con­sci­en­tious and pay their tax­es and com­ply with Cus­toms laws,” Im­bert said

The bill’s claus­es in­clude:

The En­force­ment Di­vi­sion staffed by pub­lic of­fi­cers will ex­er­cise en­force­ment pow­ers.

• Pub­lic of­fi­cers will ex­er­cise the pow­ers, au­thor­i­ties and priv­i­leges con­ferred by the Cus­toms laws, Ex­cise Act and oth­er rev­enue laws list­ed. The Bill main­tains the cur­rent sta­tus quo. Con­se­quent­ly, in re­la­tion to en­force­ment, there will be no de­par­ture from what cur­rent­ly ob­tains

• A Di­rec­tor Gen­er­al will man­age TTRA and have re­course to civ­il pro­ceed­ings re­gard­ing en­force­ment of rev­enue laws.

• More in­tru­sive func­tions, es­pe­cial­ly those cur­rent­ly be­ing ex­er­cised by the Cus­toms and Ex­cise Di­vi­sion and found un­der the var­i­ous rev­enue laws, are re­served for a Deputy DG.

• A TTRA board will be ap­point­ed by the Fi­nance Min­is­ter, who will be able to give gen­er­al pol­i­cy di­rec­tives. But the board won’t be re­spon­si­ble for en­force­ment of rev­enue laws and won’t pro­vide spe­cif­ic in­struc­tions to the Di­rec­tor Gen­er­al or any oth­er of­fi­cer on any func­tion.

• The board is al­so not per­mit­ted ac­cess to in­for­ma­tion with­in the au­thor­i­ty that re­late to any in­di­vid­ual, as well as any doc­u­men­ta­tion con­cern­ing le­gal au­thor­i­ty for/against TTRA.

• The Di­rec­tor Gen­er­al is sub­ject on­ly to gen­er­al di­rec­tions of the board and gen­er­al pol­i­cy di­rec­tions of the min­is­ter.

• The Di­rec­tor Gen­er­al to sub­mit to the board and min­is­ter a month­ly re­port on rev­enue col­lect­ed.

• Pub­lic of­fi­cers with per­ma­nent ap­point­ments or tem­po­rary ap­point­ments of at least two con­tin­u­ous years may, with­in three months of the com­ing in­to force of this Act, vol­un­tar­i­ly re­tire or trans­fer to TTRA, or be ap­point­ed on trans­fer by the Pub­lic Ser­vice Com­mis­sion to a suit­able pub­lic of­fice in the En­force­ment Di­vi­sion; or re­main in the Pub­lic Ser­vice.