Unfortunate advice

While we understand the concerns of many at the prospect of having to pay substantially increased taxes, nonetheless, once the Property Tax Bill, which was passed this week in the House of Representatives, is assented to by President George Maxwell Richards and is later proclaimed, Trinidad and Tobago householders will have no choice but to pay the relevant increases or face uncomfortable consequences.

When the Property Tax becomes the law of the land, it should be followed. As such, the advice offered by Maharaj, a former United National Congress Attorney General and a high-profile member of the Trinidad and Tobago Bar was unfortunate.

Newsday has severe reservations with respect to the proposed Property Tax which we have expressed on several occasions and will continue to do so, but we cannot and will not agree with Maharaj’s reported recommendation to supporters at Claxton Bay on December 21. We hope that Maharaj has a rethink on what after all was an incautious statement. What is a fact of life is that TT householders have been paying Lands and Building taxes, the forerunner to the Property Tax, for generations. The decision, however, of Government to push forward with an adjusted Lands and Building taxes, renamed Property Tax, with clearly significantly increased payments cannot be supported.

Regrettably, Government has been less than frank with householders about the amount of money they will be called upon to pay. This, even with homeowners and we should add landowners, being required to pay the respective increases in the New Year. According to the Ministry of Finance, official correspondence addressed to householders across the nation should be in the mail by the end of March 2010, with the new charges starting effective January 1.

The needless delay in advising home and landowners as to what their taxes would be has provoked unnecessary concern that the planned charges would be somewhat high. This could have been avoided had Government begun and completed the revision of site values, say from January of this year.

But for Government to tell the country during the Budget Speech in September that it planned to “introduce” a Property Tax as of January of next year without any indication as to the level of the increases was downright insensitive.

In addition, the timing of the announcement of the proposed Property Tax could not have been worse. It had been done when the country, severely affected by the international financial crisis, had, in turn, experienced two consecutive quarters of negative growth. Scores of jobs had been lost, especially at the energy-based Point Lisas Industrial Estate and in other areas because of the global economic downturn.

Nevertheless, the reality was that Government, faced with a severe drop in export revenues, Corporation and Personal Income Taxes, Value Added Tax and Customs and Excise duties clearly felt the need to raise money and opted for the Property Tax. Regrettably its handling of the exercise was clumsy. Despite this, the Property Tax, when it becomes law, has to be paid and for anyone to urge on others not to pay it, particularly someone who once held high ministerial office, was as we said before, unfortunate.

This does not mean that the legislation cannot be threatened in court as another former Attorney General, Kamla Persad-Bissessar, has hinted she might decide to do should the bill become law. Already, Persad-Bissessar has, reportedly, stated she has enlisted the assistance of two Queen’s Counsel from Barbados. This strikes as a better approach than the reported urging of persons not to pay the Property Tax.