The government’s tax policy over the last two years has largely fallen short of its intended revenue targets, and is contributing to the contraction of the economy, economist and lecturer at the University of the West Indies, Dr Vaalmikki Arjoon told Business Day.

For the first six months of fiscal 2017, tax revenue was $13.2 billion — nine percent lower than the same period in fiscal 2016. In fiscal 2016, projected tax revenue was $40.8 billion, but instead earned $29.7 billion — a shortfall of 27.2 percent.

This despite increases in the Green Fund Levy and the Business Levy; the introduction of the seven percent “online shopping tax”; the “millionaire’s tax” of an additional 25 percent tax on income over $1 million; and the introduction of VAT on yacht-in-transit equipment, which was vehemently contested by the yachting industry and subsequently removed — all announced in the 2017 Budget presentation.

“The country was already at a point where the economy was contracting so the consumption expenditure (consumer spending) and investment expenditure (capital spend by firms) were already declining,” Dr Arjoon said.

Increasing taxation, then, would have caused further contraction in the economy since an increase in taxation would have naturally exacerbated already rising costs of doing business, with spill-over effects resulting from firms downsizing either through reduced inventory, layoffs or other cost cutting measures.

These policies have stifled the business sector, reduced competitiveness and increased uncertainty, Dr Arjoon said.

“Coupled with current state of economy, this has reduced confidence. Businesses will pull back and either watch and wait for some signs of recovery or there will be capital flight where they choose to invest outside of Trinidad and Tobago,” he said.

The conversation now needs to switch from taxation to expenditure, said Wade George, Caribbean Tax Managing Partner for Ernst & Young.

“I don’t think there is more room for greater taxation without really damaging the economy or slowing it down completely,” George said. “You can’t tax your way out of a recession.”

There is a limit to how much the government can raise taxes in terms of what the country can take and what the population can absorb.

“I don’t think we’ll see much more taxes in the new Budget, but there are other things the government can substitute — for example reducing or removing subsidies on fuel and making utility prices more market driven,” he said.

There is some leeway for the government in terms of existing or announced taxation policies, he noted, for example, the reintroduction of the Property Tax and even a higher value added tax.

“Almost every country has some form of Property Tax. And Trinidad and Tobago has one of, if not the lowest VAT rate in the entire region. These would be the easiest tax policies to sell if they needed to,” George said.

In fiscal 2016, the government had expected to earn $12.4 billion from VAT, but only earned $7 billion. For fiscal 2017, the amount collected in the first six months is $2.8 billion or 22 percent lower than the same period in the previous year.

The population would, however, likely demand improved efficiency and value for money should tax rates increase.

“There is no connection for people between the payment and return or value for money, and this is something the government has to address. Once you see it translate into something of value then you might have an easier time converting it a cost you are willing to pay,” George said.

In the early 2000s, during the latest energy boom, since so much government revenue came from that sector, government expenditure “didn’t feel like your money,” he suggested.

Now that the energy sector can’t contribute, citizens have to step up, and now they want to know how their money is being spent.

“A large part of the noise isn’t the tax itself but how it is being used,” George contended.

Fundamental to the process, however, is tax collection management.

“It’s inefficient,” Dr Arjoon said bluntly, adding that the proposed Revenue Authority needs to be implemented as a priority.

Businesses are evading taxes, and this is a disadvantage for the Government.

“We need to pay attention to the collection process. Trade ‘misinvoicing’, for example, (where firms deliberately misstate the value of their export cargo as less than it is worth) has cost the country US$33.6 billion in just over a decade. We are losing revenue and leaking foreign exchange,” Dr Arjoon said.

George agreed that to a large extent, inefficiency is the bane of tax collection process, with the current systems at Board of Inland Revenue, the country’s tax collection agency, not the most client and consumer friendly.

“The motivation is not there, nor systems for management and accountability. There is very little in terms of clear guidelines for interaction with the public for issues around collection. The system needs a complete transformation,” he said.

He noted that, just as the country has heard several times before, the Revenue Authority will likely be raised in the Budget — and despite the difficulty in finding a bipartisan solution to tax reform, it has to be done.

“It has to be done correctly. This is not the first time tax reform has ever been done. It’s not like you can’t find a model out there,” he said.

Other views on taxation

Christopher Alcazar, President of the Trinidad and Tobago Manufacturer’s Association:

“We are very much in support of the Revenue Authority of Trinidad and Tobago.

Rather than raise the tax rate, collect from those that are falling through the cracks. That is where we can make up the shortfall.

“The problem for manufacturers is we are trying to be more competitive so we can export and obviously, taxes don’t help. We’ve had discussions with the Minsters of Finance (Colm Imbert) and Trade (Paula Gopee-Scoon) and made proposals to the Ministries. (Imbert) did not make any promises but the discussions were promising.

The manufacturing sector employs nearly 60,000 people across the country. We hope our concerns have been noted and the Budget brings positive news to manu¬facturers to help pull us out of this lull.”

Dr Thackwray Driver, Chief Executive Officer of

the Trinidad and Tobago Energy Chamber:

“The number one issue for us is the Supplemental Petroleum Tax. This is a tax on revenue, not profit and kicks in as soon as prices go above US$50 a barrel. Per¬versely, oil companies are better off if the price stays below US$49.

For smaller operators, especially those who operate on tight margins, this causes a negative cash flow situation. When prices are in this US$50 range, people aren’t willing to invest in oil production. We don’t mind taxes on profits, but not on revenue.

The Ministry of Finance is aware. The International Monetary Fund has also made some short term recommendations for incremental change that we think can be implemented during a transitional period (while reform is being considered).

Property tax on facilities is also something we would like clarified. In principle, I don’t have a problem with property tax but in the current climate it’s probably not the best thing to be doing. There is also the lack of clarification about how the value of an asset will be calculated. What is the formula? There has been no proper communication from the Government.

The speed of VAT refunds is also something that can really affect cash flow, again for the smaller companies with tight margins. Bigger companies can probably buffer but for a service company or contractor it puts them in a difficult cash flow situation.

We understand the government has its own cash flow problems but it makes hard for smaller operators.”

Shiva Boys earned their fourth straight win of this season as they accumulated a maximum total of 12 points from the first four games.

The hosts looked comfortable throughout the encounter and took the lead in the ninth minute when Junior Asson found the back of the net. Quinn Rodney added Shiva’s second in the 31st minute as they went into the halftime interval with a two-nil lead. After the break, the hosts took hold of the match as Tyrel Baptiste added the third goal for Shiva Boys in the 50th and, five minutes later, Jude Phillips struck the fourth. Yohanese Richardson also found himself on the score-sheet for Shiva after he netted the fifth in the 72nd minute. QRC got a consolation goal when Marquis Lewis ruined Shiva’s clean sheet in the 83rd minute.

Presentation College San Fernando remained two points behind the leaders as they defeated Signal Hill 3-0 at Guaracara Park, Pointe-a- Pierre. Pres Sando are also undefeated as they won three matches and drew one, after four rounds. San Juan North played host to Trinity Moka and demolished the visitors 7-0.

St. Anthony’s and Naparima squared off in Westmoorings but the contest ended in a 2-2 draw. Naparima’s Rondell Payne opened the scoring in the 34th minute but his joy was shortlived as he received his second yellow card, in the 46th, leaving the visitors a man down.

Ronaldo McIntosh doubled the lead in the 48th minute but they then gave away a penalty in the 51st; St Anthony’s Jodel Browne stepped up and slotted the ball home to halve the deficit.

The home fans got behind their team and raised the team’s spirits as they were rewarded when national youth team midfielder Che Benny bagged the equaliser in the 75th minute.

In the other games, Fatima got past Speyside, 1-0 at their home grounds in Mucurapo while Fyzabad got an away win when they defeated Trinity East 2-1 in Trincity, courtesy of a double by Sharkell Louison (seventh and 55th), while Josiah Lord (87th) netted for Trinity East.

St Mary’s College battled to a 1-1 draw with St Benedict’s on their home field and St Augustine were also held to a 2-2 draw by Carapichaima in St Augustine.

Knight Riders, who chose to bat first after winning the toss, compiled a total of 68 runs for the loss of six wickets after their mandatory 10 overs. Junior Johnson stroked an unbeaten 19 runs while Shiva Roopchand and Harvey Rampersad contributed 15 and 13 respectively .

Strikers’ Kishan Baliram claimed three wickets for two runs while Brandon Harrylochan copped one wicket for 13 runs .

In their run chase, the Strikers were not able to reach their target, despite Jason Jairam’s topscore of 22 .

After their 10 overs, Strikers could only get 52 runs for the loss of two wickets. Johnson also contributed with the ball as he claimed one wicket for six runs, including a maiden wicket over .

Marcus Serattan got the other wicket in the innings as he went for 16 runs after his two overs .

In the end, it was the Knight Riders who walked away with the trophy, bragging rights and the $8,000 jackpot while Strikers had to settle for the runners-up prize of $5,000 consolation prize .

Johnson was named as the Manof- the-Match .

Teams – KNIGHT RIDERS: Suresh Baal, Harvey Rampersad, Hyden Rampersad, Shiva Roopchand, Jarred Phillip, Zard Clarke, Antonio Samlal, Brandon Ganga, Junior Johnson, Marcus Serattan, Michael Jordan, Shyan Moonwha, Reynold Jerome .

STR IKERS: Jason Jairam, Hanuman Moonsammy, Dave Baboolal, Brandon Harrylochan, Dalyon Angard, Dilip Ramnanan, Raphael Teeluck, Nishan Sookhoo, Joel Gayah, Steffon Roopnarine, Ricardo Martin, Narin Rampath, Kemchand Deosaran, Kishan Ballira .

Approximately 80 people comprising of staff members, family and friends from these organisations, alongside hundreds of other local enthusiasts (at different locations) and millions throughout the globe, helped promote ocean conservation on this day.

Vice president of marketing at TSTT , Camille Campbell, commended those who came out in their numbers to assist in the ICC activity.

Brand ambassador, Dwayne Bravo, was on hand to support the beach clean-up following his hectic but victorious Trinbago Knight Riders Caribbean Premier League T20 campaign.

“Both locals and tourists come to this beach and it’s good to see that bmobile has taken the lead when it comes to the upliftment of the country. For me personally, I saw it fit to come and support these volunteers, who took time out to help make this country a cleaner place, for all of us to enjoy. I’m also happy to see many kids out here today assisting in this effort to preserve our environment,” he stated.

The ICC initiative, held annually on the third Saturday in September, was coordinated on a worldwide scale by Ocean Conservancy Office of Pollution Prevention and Monitoring, and presented—in its 13th year locally— through the Caribbean Network for Integrated Rural Development (CNIRD)

Simply called We Jamming Still, the media and specially invited guests got a view of the costumes including Monday Wear at Vas Lounge, St Clair, last Saturday.

The launch was a collaboration between Legacy and Young Generation.

We Jamming Still comprises ten sections designed by Big Mike Antoine but only nine were shown. Registration begins tomorrow at Legacy’s headquarters on Roberts Street, Woodbrook.

Legacy has an interesting advertisement telling potential masqueraders to think before they spend, and urges them to come to Legacy and get costumes starting at $1,200 which can be used as a base to build on and have fun and excitement with road artistes from the USA, Barbados, Jamaica and TT.

Opening a Pre-Budget Forum titled Budget for Gender Justice: Make Households Matter to the House, last week at The UWI’s Learning Research Centre, head of the institute, economist Dr Gabrielle Hosein, said the institute had begun developing a Gender Justice Scorecard. A handout circulated at the forum said the goal of the scorecard will be to provide “a gendered analysis of national fiscal policy and its implications for peace, security and empowerment within households, highlighting how the national budget process and budgetary allocations have differential and inequitable impact on women, men, girls and boys in a time of economic crisis.”

It added that by stimulating wider engagement with “gender-sensitive budgeting, the scorecard will also support Central Statistical Office (CSO) capacity building for better governance, and will provide an example of action to achieve the Sustainable Development Goals, particularly Goal 4 – Health; Goal 5 – Gender Equality; Goal 8 – Reduced Inequalities and Goal 16 – Peace, Justice and Strong Institutions.”

However, Attzs said such an objective might risk being impeded by a lack of relevant data or gender analysis of economic developments in the country, observing that it was important for policymakers and researchers to have the kind of data to help them make informed decisions and recommendations. “The issue of data paucity cannot be ignored. We are essentially feeling our way in the dark, trying to make decisions, trying to mainstream gender, trying to develop things like

the gender scorecard, trying to achieve gender justice, but we don’t have the data to support the path that we want to take.”

By way of illustration, she showed a slide of a table on this country from the World Development Indicators which she said she had downloaded “in the last 24 hours” so that it was as current as possible. The table showed that information broken down by gender in a number of key areas was either missing or incomplete. She said the table was informative “in a perverse way” because “if we don’t have data then we can’t make policy decisions that help us achieve the desired outcomes”. She said “essentially, we treat Ministries and budgetary allocations as if they are operating in silos and not really understanding and recognising that if we are to achieve the empowerment, or that greater gender balance in terms of how our men and our women develop and how they access services and how they ultimately become empowered.”

She said the society was talking about improved access for women to various programmes so that they could improve their lives and become more empowered and more active participants in the economic space, “but we don’t have the dis-agregated sets of data to allow us to see what touch points of intervention are required to help us to achieve that particular outcome.”

Hosein referred to a number of calypso classics such as Singing Sandra’s Crying, Shadow’s Poverty is Hell, Sparrow’s Capitalism Gone Mad, and Brother Resistance’s Ah Cyar Take That, which all chronicled the hardships of poverty, saying these songs “all spoke to everyday life and the stresses of providing care for children and the elderly as well as the effects of violence on families, the pressures of unemployment, under-employment and informal work and an inability to make ends meet.”

Hosein said the project being undertaken by the institute was to provide data to respond to the cries of the calypsonians and to empower civil society advocacy for State accountability to these realities. She said the global political economy must be held accountable at a time of economic and ecological crisis, adding that “the current global and national economic models cannot solve this crisis because neither oil nor gas will get the country out of the economic and ecological crises it faces.” She said, “its permanence makes focusing on the insecurity it causes a matter of urgency. At the very least national fiscal policy and planning must be held accountable for how it addresses the causes and effects of this crisis on everyday life. “

She said that the country’s “big dreams” for development, peace and sustainability also require gender justice and where gender justice exists, ideas about womanhood and manhood do not reproduce discrimination, denial of rights and vulnerability to harm and inequitable access to power and resources. “States, communities and individuals all actively committed to transforming these into just opportunities, outcomes, norms and relations from women, men, girls, and boys.

She said that according to UN Women, the United Nations entity for gender equality and the empowerment of women which became operational in 2011, gender budgeting is not about creating separate budgets for women or solely increasing spending on women’s programmes, rather it looks beyond the balance sheets to investigate whether women and men fare differently under existing expenditure patterns. She said it calls for adjusting budget policies to advance gender equality and more equitable distribution of the gains of economic development, adding that it is a step toward greater public transparency.

The idea is not a new one. Hosein said that as far back as the 1970s, “Caribbean feminists showed how structural adjustment policies impoverished families and communities. Two decades later, they began to push for gender responsive budgeting with organisations like the Network of NGOs of Trinidad and Tobago for the Advancement of Women, and the Women’s Institute for Alternative Development, taking the lead. Two decades later, we continue to build on that legacy. Our goal is to press forward national conversations about the everyday life of this current crisis and its different impact on women, men, boys and girls. It’s the differential impact that makes commitment to and advocacy for gender justice so key. Our goal is therefore to begin to provide gendered analyses of the national budget process and budgetary allocations and their implications for peace, security, empowerment and gender equality as experienced in everyday life and in our households.

Hosein said that over the next three years, the institute will be working to produce a gender justice scorecard which will aim to access five sectors in terms of gender responsive budgeting: labour; social services; health; education and agriculture. “And we have a special focus on cross-sectoral concerns related to gender-based violence and the care of the economy. We hope that this will help to empower citizens to advocate for greater fiscal accountability to people’s lived realities, to influence the budget process and to press governments to meet international commitments, among them the elimination of all forms of discrimination against women, the Inter- American Convention on the Prevention, Punishment and Eradication of violence against women and the Sustainable Development Goals 2016 – 2030.”

One regional reader sent me a message with this scenario:

“Dear Nicole, I recently had a business interaction that left me with a rather bitter taste in my mouth, and I wondered if perhaps I was over complicating the issue. I was on the market to purchase a luxury yacht for leisure use, and was in heavy negotiation with a potential seller. After a number of meetings, viewings and negotiation, I finally agreed upon a figure and set a date to undertake an engine and run test, and to complete the transaction. To my utter surprise, as I arrived at the marina, I saw the owner of the said vessel, undergoing a site visit with another buyer. The owner also had the audacity to invite me to sit and wait whilst he was finishing up this process. Now, I understand this may be trivial to some; however this was a very heavy weighted decision for my retirement which my wife and I did not take lightly. Am I overreacting? Or was this seller’s behaviour completely unethical?”

My response to the writer began with an overview of business ethics, which according to investopedia.com, means the study of proper business policies and practices regarding potentially controversial issues, such as corporate governance, insider trading, bribery, discrimination, corporate social responsibility and fiduciary responsibilities. Law often guides business ethics, while other times business ethics provide a basic framework that businesses may choose to follow to gain public acceptance. Even though this can be considered the academic overview of what is accepted behaviour in business operations, the underlying matter that binds all transactions in a business context is trust. In any culture, country, organisation or corporation, if trust is not developed and maintained throughout the business interaction, then more than likely the transaction will be shaky at most.

Based on the scenario above, there are a number of red flags that provide a good benchmark for the transaction to be seriously reconsidered. The first being the breach of trust, the second being the lack of respect demonstrated by the seller. Based on the information provided, the seller clearly would have been afforded the same insight you have provided to me, including the fact that this is your retirement investment plan, which means, you would also have an emotional investment into the purchase. It stands to reason, the seller sought to utilise this intelligence to his advantage, thinking that perhaps your emotional connection to advancing your retirement plan could be manipulated thereby encouraging a faster, and perhaps higher sale price. Further, the complete lack of respect demonstrated by inviting another buyer to view at the cusp of your closing the sale demonstrates a lack of transactional intelligence by the seller. This can also be construed as another means of pressuring you into purchase at a higher bid price, but the demonstration of high interest by others. This seller has broken two fundamentals in terms of reputable transaction management, trust and respect. Think carefully before you proceed.

I submitted this feedback privately to the reader, and was provided an update, which stated:

“Dear Nicole, thank you for your feedback. After a few checks on the background of the seller, we realised this was indeed his modus operandi [attempting to manipulate a price hike], and declined to proceed with the sale. He still has the vessel in his hands, and has reduced his asking price.”

The 24-year-old Walcott copped gold at the 2012 Games in London, England as well as bronze four years later in Rio de Janeiro, Brazil.

But Chin, in a recent interview, pointed out, “it is heartbreaking for (Trinidad and Tobago’s) main hope for achieving gold at the Olympics to be regressing rather than progressing.” Chin, a taekwondo practitioner and instructor for 45 years, specialises in stretch flexibility and kinesiology, both in martial arts and sports on a whole.

He pointed out that, while studying in Canada in 1972, he was surprised to hear about the then-rising TT sprinter Hasely Crawford who was making for himself ahead of the 1972 Olympics in Munich, West Germany (now Germany).

“My eyes were glued tot he television watching my fellow countryman go for gold,” said Chin.

“To my dismay, what was meant to be gold turned to a roll as Hasely pulled up (with) a hamstring strain. My heart (sunk) like the Titanic.” Chin has developed powerful kickers by using kinesiology. One of his students has developed the power to burst the chain that swings the bag, upon kicking the bag. His son Elliot has the capability to kick a 70-pound punching bag a complete 360 degrees, while another son Edward consistently rips the punching bag in half.

Kinesiology is the know-how to enhance performance by improving mechanics and improving leverage.

Persons interested in contacting Master Chin can do so at 718- 1915 or 686-0020.

Illegal structures can be seen in cemeteries, on the roadsides and on lands that do not belong to persons building on the lands. Compounding the situation, some of these illegal structures have electrical and water connections.

The situation has prompted engineer Dr Myron Chin to speak out on the subject. Writing in the latest issue of Caribbean Construction Digest (CCD), he said, “The need for a national building code (NBC) for Trinidad and Tobago has long been recognised and various attempts have been made to develop one over the past four decades, but so far, it remains an elusive dream.

He said, “The development and enforcement of a national building code is indispensable to the orderly and safe development of a country’s built environment and therefore, its sustainable development.”

The destruction caused by earthquakes in recent years, including in Haiti in 2010; in Chile also in 2010, in New Zealand in 2011, and most recently, in Mexico this week, show that tremors, in any part of the world, should be taken seriously.

“Main objectives of such a code”, Dr Chin said, “is the establishment of minimum requirements for design, construction and occupancy of building structures with the aim of protecting public health, safety and general welfare.”

He said while it was common knowledge that Caribbean islands were situated near a “seismically active zone”, he added “the long return interval between devastating regional events and other prevailing factors have combined to make it difficult for most countries of the region to establish and sustain effective earthquake risk reduction programmes.”

Dr Chin pointed out that in the absence of earthquake risk management programmes locally, population increase and economic development over the last five decades have taken place in such a way that earthquake risk was currently at levels that were unacceptable.

“The cost, in terms of human and property losses, that a large to great earthquake could inflict on any Caribbean island can be extremely high and is expected to continue to rise in the future, unless concerted efforts are made to address the multi-dimensional causes of earthquake risk by means of new, effective initiatives.”

Thirteen years ago (2004) the Caribbean Development Bank (CDB) convened a meeting of key regional stakeholders to assess the regional readiness to withstand natural disasters such as earthquakes and hurricanes.

Resulting from that findings of that meeting, the bank agreed to fund the development of a new Regional Building Standard (RBS) based on the International Building Code (IBC) with Caribbean Application Documents (CADs) for the various Caribbean islands.

This was to be executed by the CARICOM Regional Organisation for Standards and Quality (CROSQ). However, the organisation has to this day been unable to complete the RBS, the deadline for which was April 2010.

Because of this, deadline for the RBS had been extended by 18 months, but there is skepticism and wariness among local stakeholders with regard to the ability of CROSQ to keep the extended deadline. Consequently, the Trinidad and Tobago Bureau of Standards (TTBS) submitted to the Ministry of Works and Transport a proposal for developing an NBC for Trinidad and Tobago along similar lines as the RBS proposal. This was done in early 2011, but to date it has not had any positive response from the Ministry.

Past initiatives in this regard included, inter alia, the development of the Caribbean Uniform Building Code (CUBiC) in 1986, a proposal for the development of a Regional Building Standard (RBS) since 2004 and more recently, a proposal for developing an NBC for Trinidad and Tobago.

Recent initiatives such as the Global Facility for Disaster Reduction and Recovery (GFDRR) and the Global Earthquake Model (GEM) have served as catalysts for regional disaster management efforts.

LOCAL parang queen Alicia Jaggasar is one of the headlining acts for tonight’s Cabaret at the Kaiso Blues Café at 8:30pm.

In this semi-staged production operatic tenor John Thomas plans to treat the audience to treasured classics of yesteryear, featuring oldies but goodies from Frank Sinatra, Tony Bennett and Rogers and Hammerstein.

Others on the cast are Kyle Richardson who plans to spice things up with his tribute to Shirley Bassey, singing one of her more popular tunes, dressed in “character”. L A Rose will add a fusion of both new and old.

Joining them will be young and upcoming Kita Gadsby, who is making a name for herself as a soloist of the Lydian Singers and the EPAF artist collective.

Other EPAF artist collective performers for the evening include Aaron Mark Alleyne, who can be regularly seen on DC Shell’s stages portraying several storybook characters, Music Festival Musical Theatre Champion Jeanine Clarke Jackson, Music Festival Champion Maxine Greaves, ANENO’s Noel Espinoza and UTT music Bachelor student Kiana Tinto.

“The evening promises to be one of nostalgia, and delight, almost bringing back dinner theatre to the island as you can have dinner and watch us perform,” Thomas said in a media release. “It’s not every day you get a stellar cast doing a production of this standard for a nominal nightclub cover-charge!” He described the evening as one full of good entertainment for almost all ages.