T&T is get­ting set to rein­tro­duce prop­er­ty tax as one of the rev­enue streams which is ex­pect­ed to rake in mil­lions of dol­lars for the Trea­sury.

But this move has caused ap­pre­hen­sion and trep­i­da­tion among thou­sands of cit­i­zens al­ready reel­ing from the ef­fect of sick­ness, deaths, job loss­es and re­duced in­come due to the COVID-19 pan­dem­ic. Many cit­i­zens have ex­pressed grave con­cerns that they will now have to shoul­der yet an­oth­er bill.

But ac­cord­ing to a val­u­a­tions ex­pert who spoke to the Sun­day Guardian, there is no spe­cif­ic date giv­en for the roll­out of this tax, how­ev­er, the Gov­ern­ment has start­ed lay­ing the foun­da­tion for it.

"The Gov­ern­ment has not ac­tu­al­ly said when it is go­ing to im­ple­ment the Prop­er­ty Tax, so while they are do­ing the prepara­to­ry work one can­not say with any sense of sure­ty when it will be done, but they are lay­ing the foun­da­tion for it."

The Gov­ern­ment has put out ad­ver­tise­ments call­ing on cit­i­zens to file in­for­ma­tion on prop­er­ty and land own­er­ship with the Val­u­a­tion Di­vi­sion, Min­istry of Fi­nance (MOF). They must do so by the end of No­vem­ber 2021, and fail­ure to do so can see cit­i­zens fac­ing a fine of $5,000.

"The Gov­ern­ment is at­tempt­ing to pop­u­late the val­u­a­tion roll now," the val­u­a­tions ex­pert said.

This, he said, is the nec­es­sary ground­work that would even­tu­al­ly see Prop­er­ty Tax be­ing levied on res­i­den­tial and com­mer­cial prop­er­ties as well as on agri­cul­tur­al lands.

The Sun­day Guardian called Min­is­ter in the Min­istry of Fi­nance Bri­an Man­ning and the Com­mis­sion­er of the Val­u­a­tion Di­vi­sion on the move to im­ple­ment the tax, but no in­for­ma­tion was forth­com­ing. Man­ning re­ferred all ques­tions to the Val­u­a­tion Di­vi­sion head. But while ques­tions were sent to the com­mis­sion­er and tech­ni­cal of­fi­cers as di­rect­ed, no one re­spond­ed.

The Patrick Man­ning-led Peo­ple’s Na­tion­al Move­ment (PNM) ad­min­is­tra­tion passed the Prop­er­ty Tax in 2009 but was un­able to im­ple­ment it as cit­i­zens vot­ed them out at the polls in 2010 due in part to an 'Axe the Tax' cam­paign led by the Peo­ple’s Part­ner­ship (PP) which took of­fice from 2010 to 2015. In 2009, then Op­po­si­tion Leader Kam­la Per­sad-Bisses­sar joined with the Con­gress of the Peo­ple (COP) to fight the PNM’s Prop­er­ty Tax ini­tia­tive. Launch­ing the ‘Axe The Tax’ cam­paign then, they fought against the na­tion­al is­sue which touched every per­son in­clud­ing ten­ants, landown­ers, home­own­ers, busi­ness op­er­a­tors, and squat­ters. They had la­belled the Prop­er­ty Tax as a "de­mon­ic tax."

The Sun­day Guardian spoke to the val­u­a­tions ex­pert to get some clar­i­ty.

While the PP nev­er re­pealed the Prop­er­ty Tax Act, they nev­er im­ple­ment­ed it ei­ther so it just re­mained in abeyance.

"This means the Gov­ern­ment does not have to go back to Par­lia­ment, they can now move to im­ple­ment it which is what they are do­ing. There is no le­gal im­ped­i­ment what­so­ev­er to the im­ple­men­ta­tion of this tax at this time," the val­u­a­tions ex­pert said.

Ac­cord­ing to the val­u­a­tions ex­pert, want­i­ng to be fair to the State, mora­to­ri­ums on Prop­er­ty Tax (pre­vi­ous­ly called Land and Build­ing Tax) were grant­ed from 2010-2015 and 2015-2018. To date, the tax has not been im­ple­ment­ed. That means that cit­i­zens have not been pay­ing tax on land and build­ing for about ten years.

Point­ing to the ef­fects of the on­go­ing pan­dem­ic, he de­scribed the pro­posed mea­sure as a "dou­ble wham­my" where your in­come has fall­en and your cost of liv­ing has risen.

"You are be­ing squeezed from two sides with loss or re­duc­tion of in­come, high­er food prices and the ex­pens­es of on­line school­ing which did not ex­ist be­fore, and now, this ad­di­tion­al ex­pense."

How­ev­er, he did not think any gov­ern­ment would want to im­me­di­ate­ly fur­ther bur­den a pop­u­la­tion that is so hard-pressed right now.

File picture 2017: Members of the public line up at the Ministry of Finance Valuation Division at Palms Club in San Fernando to submit the first valuation evaluation form.

RISHI RAGOONATH

'A wealth tax'

Re­fer­ring to the propen­si­ty of the Prop­er­ty Tax to morph in­to a "wealth tax," he ex­plained, "the bet­ter the state of your home due to im­prove­ments and ameni­ties, the high­er your prop­er­ty tax will be."

He ex­plained there were three as­pects to this process–sub­jec­tive, ob­jec­tive and rel­a­tive.

"If you have a two or three-storey house with five bed­rooms, ob­jec­tive­ly it will cost more to rent some­thing like that than a two-bed­room one-storey house. The val­ue can al­so be sub­jec­tive as you can have a fan­cy house in one area of the coun­try and that ex­act de­sign in an­oth­er part of the coun­try in a low­er-in­come neigh­bour­hood, but the rental val­ue will be dif­fer­ent, so that will be sub­jec­tive. Then there is rel­a­tive, where the mar­ket val­ue has to be based off sup­ply and de­mand vari­ables."

Peo­ple who have tem­ples, store­rooms, green-hous­es, and pet dwellings con­struct­ed on their prop­er­ties do not have to wor­ry as these struc­tures will not be sub­ject­ed to tax.

How­ev­er, for those with pool hous­es that are com­fort­ably out­fit­ted and can be con­sid­ered an ex­ten­sion of the liv­ing quar­ters, this will be sub­ject­ed to tax and will there­fore in­crease the own­er’s an­nu­al Prop­er­ty Tax.

Even squat­ters and renters will have to pay tax as they will be classed un­der oc­cu­pi­er.

Asked what could be the pos­si­ble out­come if some­one is un­able to pay the tax, the val­u­a­tions ex­pert said there was an op­tion in law to ap­ply for a de­fer­ral.

For these peo­ple, no in­ter­est will be in­curred on the amount which will be rolled over to the next fis­cal year.

He added, how­ev­er, "A de­fer­ral does not mean ex­emp­tion. It sim­ply means it will keep build­ing and build­ing against the prop­er­ty. If a per­son dies be­fore this, the full amount will have to be tak­en out of the per­son’s es­tate un­less it is passed on to some­one who is al­so in­di­gent…then they can get an ex­emp­tion from hav­ing to sat­is­fy the debt the pre­vi­ous own­er would have owed, but they will now have to start pay­ing the tax from the point of in­her­i­tance."

While he felt it was un­like­ly that it will land those who are un­able to pay on the streets he added, "It will be an ad­di­tion­al bur­den on the pop­u­la­tion."

'Prop­er­ty Tax ques­tions in­tru­sive'

Agree­ing the lat­est form that was re­leased by the MOF last week was "in­tru­sive and in­va­sive," re­quir­ing de­tails such as whether the home has porce­lain tiles or gyp­sum ceil­ings, the val­u­a­tions ex­pert said con­cerns had sur­faced as to just how such pri­vate and con­fi­den­tial in­for­ma­tion could be kept from be­ing leaked to the wrong peo­ple.

This could hap­pen, he said, al­though there are sig­nif­i­cant penal­ties for any­one found to be leak­ing con­fi­den­tial in­for­ma­tion.

In­di­cat­ing that a per­son has the op­tion to chal­lenge their val­u­a­tion with­in 30 days of re­ceipt of the no­tice of val­u­a­tion, the of­fi­cial said it will be up to the in­di­vid­ual to prove af­ter a com­par­a­tive analy­sis or sub­mis­sion of a cer­ti­fied val­u­a­tion, just how much the fig­ure should be ad­just­ed by.

In for­eign ju­ris­dic­tions, Prop­er­ty Tax is col­lect­ed by the re­spec­tive mu­nic­i­pal­i­ty and fun­nelled back in­to pro­vid­ing and im­prov­ing the in­fra­struc­tur­al op­er­a­tions of the lo­cal dis­tricts such as road re­pairs, garbage col­lec­tion, clean­ing and clear­ing of wa­ter­ways, and gen­er­al beau­ti­fi­ca­tion.

He said, "While the in­ten­tion seems to be a good one, the dev­il is usu­al­ly in the de­tails."

Point­ing out that prob­lems can arise when these tax­es are col­lect­ed and re­mit­ted in­to the Con­sol­i­dat­ed Fund, he said, "If the dol­lars are not 'marked', then the Gov­ern­ment can ap­ply it to what­ev­er it wants to do and then al­lo­cate to the Mu­nic­i­pal Au­thor­i­ties how much ever it wants to."

Re­tired banker: Show greater ac­count­abil­i­ty for tax­es col­lect­ed

Har­joon Heer­alal, a re­tired banker of Cara­pichaima, felt the tim­ing of the tax may not be ap­pro­pri­ate giv­en "the in­abil­i­ty of peo­ple to meet com­mit­ments of tak­ing care of their fam­i­lies, and make ex­ist­ing loan pay­ments whilst still pay­ing all the oth­er tax­es di­rect­ly or in­di­rect­ly."

He said in T&T, even though tax­es are de­rived via sev­er­al means, the main grouse is the ef­fi­cient use of these tax­es.

"Roads are de­plorable, health ser­vices are very un­sat­is­fac­to­ry, school main­te­nance is dread­ful, the wa­ter util­i­ty is par­tic­u­lar­ly wor­ri­some and some projects and ex­pen­di­ture are more nice-to-have than prac­ti­cal such as the na­tion­al gas com­pa­ny is­sue, the failed San­dals ini­tia­tive and the To­co to To­ba­go sea-bridge, which is yet to be jus­ti­fied," Heer­alal said.

He said tax­es may be manda­to­ry and own­ers and lessees would not be averse to pay­ing them but asked, "to what end if tan­gi­ble re­sults are not seen in pub­lic works and so­cial ser­vices?"

Heer­alal felt the Gov­ern­ment needs to show greater ac­count­abil­i­ty for the tax­es it col­lects so cit­i­zens will be more amenable to this lat­est tax rather than utilise its pow­er to "bul­ly" res­i­dents in­to toe­ing the line.

Things to know about Prop­er­ty Tax

Ac­cord­ing to the Prop­er­ty Tax Act 2009 and the Val­u­a­tion of Land Act 58:03, amend­ed by Act 17 of 2009:

1. Prop­er­ty val­ue is cal­cu­lat­ed on:

Lo­ca­tion of the Prop­er­ty (Neigh­bour­hood)

Clas­si­fi­ca­tion of the Prop­er­ty (Ex­ec­u­tive, Mod­ern, Stan­dard [I & II])

Cat­e­go­ry of the Prop­er­ty (Agri­cul­tur­al, Com­mer­cial, Res­i­den­tial, In­dus­tri­al)

Di­men­sions – Prop­er­ty Floor Area

Mod­i­fi­ca­tions to the par­tic­u­lar prop­er­ty

2. Prop­er­ty Tax is cal­cu­lat­ed based on the An­nu­al Tax­able Val­ue of all land.

Ac­cord­ing to the Prop­er­ty Tax Act 2009, all land in­clud­ing va­cant land in T&T shall be rat­ed on a rental val­ue ba­sis. The An­nu­al Rental Val­ue (ARV) is the rent at which a prop­er­ty will be let from year to year af­ter a de­duc­tion of 10 per cent for Voids.

Tax rates are as fol­lows:

Res­i­den­tial: 3%

Com­mer­cial: 5%

In­dus­tri­al with build­ing: 6%

In­dus­tri­al with­out build­ing: 3%

Agri­cul­tur­al: 1%

Va­cant Land will al­so be taxed:

The (ARV) of va­cant land will be found by tak­ing a per­cent­age of the Cur­rent Mar­ket Val­ue of the land.

Prop­er­ty Tax is cal­cu­lat­ed by tak­ing a per­cent­age (rate of tax) of the An­nu­al Tax­able Val­ue of all Land.

Tax rates are as fol­lows:

Agri­cul­tur­al: 2 %

Res­i­den­tial: 3.5 %

Com­mer­cial and In­dus­tri­al: 5%

3. Once au­tho­rised, of­fi­cers can en­ter and in­spect your premis­es at any time dur­ing the day

Once au­tho­rised by the Com­mis­sion­er of Val­u­a­tions, of­fi­cers can en­ter and in­spect your prop­er­ty, whether you want them to or not.

Ac­cord­ing to the Val­u­a­tion of Land Act 18 of 1969:-

“Sec­tion 15 (1) Sub­ject to sub­sec­tion (2), the Com­mis­sion­er, or any of­fi­cer au­tho­rised by the Com­mis­sion­er in writ­ing for that pur­pose, shall for the pur­pose of as­cer­tain­ing the val­ue of any land have pow­er to en­ter, at all rea­son­able hours dur­ing the day­light, in or up­on any land with­out be­ing li­able to any le­gal pro­ceed­ings or mo­lesta­tion what­ev­er on ac­count of the en­try.”

4. You could be fined for not sub­mit­ting your prop­er­ty tax val­u­a­tion form

Ac­cord­ing to Sec­tion 6 of the Val­u­a­tion of Land Act 18 of 1969:

Sub-sec­tion (1) states, "Every own­er of land in Trinidad and To­ba­go shall make with the Com­mis­sion­er, a re­turn of the land in the form set out in Sched­ule II.”

Sub-sec­tion (2) states, “Where the own­er of land fails to file a re­turn, the Com­mis­sion­er shall by No­tice in­form the own­er that he is re­quired to file a re­turn, fail­ing which he may be li­able to con­vic­tion un­der this sec­tion.”

Sub-sec­tion (3) states, “A No­tice un­der sub­sec­tion (2) shall be sent by reg­is­tered post.”

Sub-sec­tion (4) states: “A per­son who will­ful­ly—

(a) fails to make a re­turn with­in the pre­scribed time un­der sub­sec­tion (1); or

(b) makes a re­turn which is de­fec­tive or in­com­plete or which is to his knowl­edge false in any ma­te­r­i­al par­tic­u­lar, com­mits an of­fence and is li­able on sum­ma­ry con­vic­tion to a fine."

5. You have 30 days to chal­lenge your val­u­a­tion

By law, cit­i­zens have up to 30 days to lodge a com­plaint af­ter re­ceiv­ing their no­tice of val­u­a­tion.

Ac­cord­ing to Sec­tion 19 of the Val­u­a­tion of Land Act 18 of 1969:-

"An own­er or lo­cal au­thor­i­ty who is dis­sat­is­fied with a val­u­a­tion may, with­in thir­ty days af­ter ser­vice of the no­tice of val­u­a­tion, post to or lodge with the Com­mis­sion­er an ob­jec­tion in writ­ing against the val­u­a­tion stat­ing the grounds up­on which he re­lies. The ob­jec­tion shall be lim­it­ed to one or more of the fol­low­ing grounds:

(a) that the val­ues as­sessed are too high or too low;

(b) that lands which should be in­clud­ed in one val­u­a­tion have been val­ued sep­a­rate­ly;

(c) that lands which should be val­ued sep­a­rate­ly have been in­clud­ed in one val­u­a­tion;

(d) that the per­son named in the no­tice is not the own­er of the land."