Some businesses in Barbados have been hit heavily by the new Municipal Solid Waste Tax, with some required to pay as much as $200,000.
And President of the Barbados Chamber of Commerce and Industry (BCCI) Tracey Shuffler said the Chamber would be seeking an audience with Minister of Finance Chris Sinckler in an effort to raise a number of concerns that members have in relation to the controversial levy.
Shuffler told Barbados Today this afternoon that some business operators were simply not in a position to pay the tax.
“The range is quite significant because some small businesses would be paying as little as $1,000 or thereabout and others are [between] $150,000 and $200,000,” reported Shuffler.
The levy is charged at rate of 0.3 per cent on the improved site value of the property. The deadline for the first payment is July 28 and the final payment is due in December.
“The Chamber is in a position where we understand that the Government is trying to close the deficit and this tax is one of those measures to try and raise revenues. However, we do have some concerns with it and we hope to have an audience with the Minister at which we can raise some of these concerns,” she said.
Shuffler said among the concerns was the lack of ability of some business operators to pay the tax, as they were already experiencing cash flow challenges given the state of the economy.
She said the Chamber was hoping that the Minister would consider allowing businesses to have “an offset of what they owe on this tax against monies owed to them by Government” should that be the case.
“That should be able to be done with the Barbados Revenue Authority in place now,” said Shuffler.
She said in a case where Government did not owe a business but that business could not afford to meet the July deadline, they would be seeking to “have a waiver on the penalty and interest” until the second payment is due at the end of December.
She said there was also a need for businesses that were large foreign exchange earners to be either exempted or taxed at a lower rate. Some of these companies would include manufacturers, some agro processors and tourism entities.
“Foreign exchange is critical to this economy so foreign exchange earning businesses and foreign exchange saving businesses have been selected by government to have special treatment overall in the economy. So what we are suggesting is that those that are net foreign exchange earners should be taxed at a significantly reduced rate, if not exempt,” said Shuffler.
“The case where you have private lands that are right now in sugar production, typically those businesses are loss-making businesses and to have this tax added would be an additional burden that they can’t handle at the moment. So some consideration should be given to those businesses as well,” added Shuffler.
She said the tax was simply “treating the symptoms of a larger issue, which is the building solid waste in this country and what we are going to do about it”.
“We have made some very bold statements about wanting to lead the region and Latin America in greening. So we need to look more closely at a couple of things; garbage segregation efforts like recycling and understanding what our longer term solutions are and therefore having more of a public discourse about the waste to energy mega project that we heard is on the table,” advised Shuffler, adding that people needed to fully understand why the tax was needed.
She said since the announcement of the likelihood of a tax related to the environment was announced last year, in some cases, the fortunes of some businesses have deteriorated.
“So the reality of having to pay this is very concerning to some business owners,” she added.
Shuffler said although she could not immediately say if the new tax would result in job losses within the private sector, it would definitely put additional pressure on some businesses that were already weak.
She noted too that given the current economic conditions some members had been doing “reasonably well” while others were “struggling significantly”.