More clarity is being sought concerning the reach of the three-month Tax Amnesty which was announced by Minister of Finance Colm Imbert during Monday’s Mid-Year Budget Review.
The amnesty, which is the sixth tax amnesty granted by the government since the year 2000 and the fourth in 10 years, was said to be an opportunity for all in arrears with regard to tax payments to clear their slates before the soon-to-be-established Trinidad and Tobago Revenue Authority (TTRA).
However, officials from KPMG yesterday questioned the short period of the amnesty.
“Normally it’s a bit longer. Could be about six months, ... if I recall the one that we had in 2010 went from about September 2010 to May 2011 and it was extended to June 2011 but at the time the minister said it was an overwhelming response,” KPMG tax director Gillian Wolffe-O’Neil told Guardian Media.
She pointed out that the previous amnesty, held in 2016, did not appear to recoup the desired $500 million target set by the Government. However, Wolffe-O’Neil said the latest amnesty should be well supported by businesses in particular with the TTRA looming.
“I assume they will take advantage because it is an opportunity to be compliant and it gives everyone a peace of mind. You may not be aware, but sometimes if you want to tender for a project or for a contract you have to get a tax clearance. So those businesses that have a desire to tender for various projects by the government or otherwise may welcome the opportunity to file returns and become compliant,” she said, also pointing out that another amnesty announced by the company’s registry could encourage previously unregistered business to come forward as well.
She was disappointed, however, that more was not said concerning the outstanding Value Added Tax payments owed to businesses. Two weeks ago, Minister of Finance Colm Imbert said he would seek to borrow money to address an estimated $4.6 billion in refunds owed to business owners for VAT.
“I was waiting for clarity there was none given and I was disappointed that I did not hear about the VAT refunds because a lot of our clients on a daily basis are telling us that they did not get their refunds they cannot invest in the business, they cannot expand their business. It is a ricochet effect,” she said.
Her colleague Saskia Carmichael-Sam, also a tax manager at the auditing firm, was also interested to see just which taxes would be covered by the amnesty.
“In terms of the minister announcing that the amnesty would apply to all taxes, it is really important that we wait until the legislation comes into play which is going to give effect to the amnesty to see what taxes it applies to,” Carmichael-Sam advised.
Another auditing company, Ernst & Young also raised questions over the amnesty’s reach in their review.
“It would also be interesting to see whether the proposed legislation addresses specific transaction taxes such as Insurance Premium Tax and Financial Services Tax. Furthermore, we also note that the Honourable Minister made no mention of the specific income years that would be covered by the amnesty,” Ernst & Young said in their report.
The Revenue Authority, which has been on top of the Government’s to-do list since taking office in 2015, is expected to aid in the collection of close to $1 billion in unpaid taxes.