On Friday, Minister of Finance Chris Sinckler sat with Barbados TODAY’S senior journalist Emmanuel Joseph in his office at Government Headquarters at Bay Street for a wide-ranging exclusive interview examining such areas as the controversial Municipal Solid Waste Tax, the International Monetary Fund’s recommendations for reforming the local tax system, Minister of Agriculture Dr David Estwick’s alternative economic programme for improving growth in the economy, Government’s retrenchment programme, Four Seasons, and the future of statutory corporations like the Transport Board, the National Housing Corporation, and the Queen Elizabeth Hospital.
We now share the minister’s thoughts on these and other critical matters in this instalment of Today’s Interview.
You have established a tax committee. Tell us about that.
Sinckler: As you know, I certainly had indicated to Parliament months ago that we had invited the International Monetary Fund Fiscal Affairs Department, that deals with tax matters, to carry out an assessment of the entire tax system in Barbados and tax policy, in particular, because we felt that after many years of having taxes and making changes, that it was necessary . . . .
It was a good time to do a complete assessment and a review, to see if there are any challenges; if there are, how we can rectify those, make the system more efficient –– all with the purpose of reducing the tax burden, while maintaining our levels of revenue. We wanted to do it last year, but the IMF couldn’t do it because they didn’t have the resources, both in terms of financial because of the allocation that their department had . . . their fiscal affairs department had, but also the personnel –– because, as you will imagine, they are busy doing similar studies in different countries.
So they agreed to do it this year, and they have started and they have produced the first draft report for consideration of the Government. We are in the process of commenting on that, and, for that purpose, we have established a small committee made up of private and public individuals; mainly people who deal with tax matters –– tax experts, to look at it and to advice the Government . . . .
That process has already started and we expect it to be completed in a matter of weeks. Once that is done, we will make our comments to the Fund; they would complete their report and hand it in officially to the Government; that is the final report.
It would then go to Cabinet, and Cabinet would note the report and discuss it; and coming out of that and the work of the committee, we would look at what recommendations therein that we can utilize; which ones do not necessarily fit with Barbados’ system, and get on from there.
So, I heard the Chamber of Commerce’s president in a statement issued yesterday [Thursday] that the Government needed to do a tax study, tax reform study. Perhaps she wasn’t aware, or wasn’t listening, but I can inform her that that is well under way to being completed.
I thank her for the recommendation, but we had already started on that months ago.
What are some of those recommendations?
Sinckler: Well, I would prefer not to say specifically, because even the report itself is not finalized, and it still has to go to the IMF board and all of that. But for what it is worth, it looks at the range of taxes we have and it makes comments on those taxes and the appropriateness of them.
It looks at the efficiency in terms of what you are levying and what you are getting back. It looks, as you would have heard from the Prime Minister, at all of the deductions and waivers and exemptions and so on, and they are quite extensive.
In other words, one of the things the report is observing is . . . and I mean, if you want, you can make an argument with the IMF over their conclusions; you can make an argument over their theology in relation to tax policy, but you can’t argue with the facts.
And the fact is that we do have taxes, but that those taxes, a range of taxes . . . and duties have so many carve-outs, so many allowances and deductions and so forth –– credits –– that the taxes themselves are being undermined in terms of what you can do. And I need to make this point, because I think people get mixed up between concessions and other types of carve-outs in the tax system.
Yes, concessions can erode taxes in the sense that if you give a concession, depending on what you give it for, you may forego that tax which might be collection. However, the point must be made that if it’s an investment, the person may not pursue the investment if the tax is there, because he may say it’s too costly and cannot get the appropriate return on investment.
So, it is really a . . . it’s not a gamble, but it’s a situation you have to analyze very carefully. If an investor comes and says: “Look, I want to invest US$200 million in building a hotel, but I need these concessions in order to make this thing viable, so that I can reduce my ‘cap ex’ cost, and when I get to operation, I would be able to operate it and have a decent margin of return on my investment.” And you say to that investor: “Sorry, but I can’t give you these concessions. I would give you X and Y, but I can’t give you the rest.”
The investor then has to make a decision. And the investor might say: “Okay, thank you; but let me try St Lucia or let me try Antigua.”
And we know that in that way, there is tax competition in the Caribbean.
Now, the IMF calls it a race to the bottom, because it means that everybody is trying to out-beat everybody else, and offering more than the others. That tends to happen sometimes, particularly when you are in difficult economic circumstances, and investment is not as freely flowing as in other circumstances –– like now.
So you may have some of that. But we have traditionally used concessions, tax policy concessions, tax concessions to drive investment and to attract investment. It is something that’s been around for a long time and it will continue for an even longer time to come. But that must be distinguished though from allowances and deductions that you may have, and carve-outs that you may have in the tax code itself, a tax system itself that speaks to your domestic population.
So, for example, if you put a VAT in place, and I know I heard the former Prime Minister Arthur in a speech in the Bahamas –– he was advising them about the implementation of the value added tax –– and he made the point in his speech by saying that if he had to do over the VAT in Barbados, he would not do so many exemptions and zero rates. In other words, carve-outs in the system.
Because when you do that, it undermines the base of the tax. The broader the net, whether it be individuals, income taxpayers, or if it is a value added tax in terms of the goods and services that are in that net, captured, that have the tax applied to it, the better; because the broader the base, the more revenue you are likely to bring in, because you are putting taxes on a wider cross section of persons, or as in the case of VAT, on the goods and services.
The more you constrict that and bring it down, the least you will likely get; and that is known. So he said that.
So, for example, in our VAT system, we have a whole lot of exemptions and zero rates. Now the exemptions are there upfront. A lot of those are in the basket of goods and so forth and so on. Then you have these zero rates in which the people charge the VAT and then claim it back. They charge the VAT from the consumer, it is zero-rated and they then claim a refund from the VAT Department. And, as you know, there’s been a lot of problems with the refund system. It’s long, it’s complicated, it’s involved, the payments are delayed; it’s not efficient in doing it, because there are so many of them.
And the IMF is saying you can reduce a lot of that because a lot of those things you have there as zero rates, some of them should not be on, and those that you want to give it to . . . a definite benefit to, should be exempted. Don’t zero-rate them and then have to go through all that process to refund; just exempt altogether. But in the category of exemptions, you have to look at how many exemptions you are giving. Do you want to give all those exemptions?
So those are the types of recommendations you would find in the thing. If you look at income tax, we have a whole slew of allowances. First of all, everybody starts with a deduction of $25,000. So if you are earning $27,000, $25,000 of it is not taxed. So all that is left is your $2,000 to be taxed on and that would be considered your taxable income.
Your assessable income would be the $27,000, but you get a deduction of $25,000; so the actual tax is only applied to $2,000. And, therefore, that’s a basic thing that everybody gets.
So, if you are earning $1 million in income, you get the same first $25,000 off as the fellow who is earning $27,000. They [IMF] are saying that’s not the fairest way; that’s not correct in doing that. You are giving the benefit to somebody perhaps who ought not to be getting the benefit. We do universality, so everybody gets the benefit. Rich, poor, in-between.
So you have a situation, for example, the evidence will show, total assessable personal income in Barbados is anywhere between $3.6 and $3.7 billion. But the total taxable income after you take out a lot of those allowances is only about $1.4 billion to $1.5 billion. [So the Government is losing a lot of money].
So that is how every year you get a lot of tax refunds . . . your income tax returns. So you lose . . . because the base of the amount of income tax . . . the amount of income that you [expect] has shrunk because you take it out of the system. And this is in a society in which you are providing relatively free education, free health care at the point of delivery, free sanitation service in terms of collection and before there was a municipal tax . . . subsidised bus fares because we are not charging the real economic fare for a bus ride in Barbados, and subsidized water as well.
So while you are having to outlay large tracks of expenditure to provide these things to your population, the revenue you are getting from the taxes is consistently going down, because you are adding all of these things to it in terms of these deductions, allowances, tax credits, and so forth and so on. Then, of course, we give a reverse tax credit, which had gone up to as high as almost $30 million. We cut it to $15 [million] in the last Budget . . . . And if you look at land tax, you get a similar situation where the first $190,000 of the value of the property in terms of the tax, the value of the property, is shielded from tax. Everybody gets that. Whether you are a million-dollar landowner or a thousand-dollar landowner, you get the same thing –– $190,000 off.
If you are a pensioner, you get as much as 60 per cent reduction in the bill, after that $190,000 is taken out. So whatever the tax demand notice, it is 60 per cent of that waived; and that goes to everybody. And I have also made the point not all pensioners are poor.
You know, some people give the impression that all pensioners live in an old house somewhere, and only living on an NIS pension; that’s not true. There are quite a few pensioners who get good pensions. But then, for all taxpayers, including pensioners, you can get a further reduction if you pay early. So the land tax bill that you get has so many carve-outs that allow you to reduce the size of the actual taxable amount; and Government, of course, is losing that revenue.
So the study looks at all these things. And it says that in the area of the actual policy, you have to make some determinations about the policy: how do you want to do this thing? If you want to provide all of these social services, you need to have the resources to do it.
If you want the resources to do it, you can’t be levying taxes and finding all kinds of different ways to give back people the money. If you don’t want to do the taxes, don’t do it at all. And then there is the whole question of the administration; and that’s why we have established the Barbados Revenue Authority.
Some people don’t like, but the authority has a seminal mission in Barbados, and that’s to improve efficiency of assessment and collection of taxes; to ensure that what we do tax and what we do assess and tax, that we get it. And, as you know, there is a lot of tax evasion in Barbados. Lots of it.
I heard the Bar Association working themselves up to have a little fight with the BRA. Well, that’s a matter for the BRA; its lawyers will advice it and will make the appropriate judgements as to what to do. So I prefer not to get involved in that exercise.
I will advice, though, that the Bar Association, their lawyers . . . everybody should read the law, read all of it and not just the part that benefit their argument. But that aside, one of the areas that we have had a lot of problems with over the years, not just this administration, [but] all Governments, are professionals who don’t like to pay tax.
They don’t pay their value added tax . . . don’t declare their income and pay [tax], and I know lawyers are among those numbers. I would love to see the day when the Bar Association issues a statement encouraging lawyers to go pay . . . ; register first, and after their register, truthfully declare their income and then pay the tax which is due to the public. Because the truth is, if we get all the people –– self-employed, professionals –– all of the people to pay the taxes which are due, I am almost 100 per cent certain, tax rates can come down.
. . . Where people are just evading, not paying, that kind of thing, you have to keep levying on a very small group of persons all the time, and that, of course, is burdensome and inconvenient.
Would you as Minister of Finance agree, with Government losing so much money from all these allowances, to cutting out some of them?
Sinckler: I don’t think it can be such a blanket exercise. You will have to look and see why it was given in the first place; what was the purpose for it; what it was trying to aid; what was the spin-off, the benefits; so you do a cost benefit analysis.
What are you losing? Why are you losing it? At the end of the day, what you may be gaining? So it’s not a straight arithmetical exercise. You want to get some revenue, so you cut out all of these allowances. But they [require] serious analysis and attention. I think over the years various Ministers of Finance, through Budgets and so on, have added to the problem.
You add an allowance for everything, add a credit for everything, not appreciating the cumulative effect. So I would say that’s what the committee and others will be looking at. And some of them in the system are frankly not needed; so we could just get rid of them. But others may have more potent impact, both in terms of what they do, but also in terms of if you get rid of them, what potential negative impact they would have.
So you have to do a fairly studious analysis of them.
So if Government is losing so much money on tax evaders, isn’t there something you can do about that?
Sinckler: The Barbados Revenue Authority! That is why the Revenue Authority, the lawyers of the Revenue Authority, because the Revenue Authority isn’t having any fight. That is why this situation you have seen played out in the last couple days, that’s where we . . . that’s why we went and got the Revenue Authority and gave it specific powers to do what is required to collect the taxes that are owed. We have to be firm.
And I have said to them –– and as minister I don’t give directives to them –– they have the law, they know what to do; but I have told them, they have to be firm going after those persons, one, who are not in the tax net that should be; two, that are in the tax net that are not paying their fair due.
That is what they have to do; and to utilize every possible power at their disposal, legally, to do so.
Has that started?
Sinckler: It has most definitely started.
Has anyone appeared in court yet?
Sinckler: Well, not yet, because a lot of people have cooperated. We are seeing a lot of difference now. People are getting the message and we are going to be pushing. There are going to be more audits on companies [and] individuals; so the public should expect that the Revenue Authority is going to be writing them if they see any oddities, anything unusual in their tax accounts.
Don’t forget now, because the system is going on a common platform, we can see each tax across the system. So before when the departments were separate, you could go and transact business with Land Tax, but you owe Inland Revenue and that kind of thing.
It’s going to be more difficult to do that now, because the tax administrators can now see all of it; because each person is going to be given a number and that will be your tax number; and when it is entered in the system, if there are flags to come up, red flags to come up, they will come up.
Let’s remain with tax –– the Municipal Tax that is now a big deal. Where are we in terms of any possible relief, any relook at the legislation, considering all the letters and noises that have been going around?
Sinckler: We always review tax systems. We always do assessments. Whenever we do a tax, you have to consistently assess it to see how it is behaving, to see what is coming in, where the issues are and so on. We look for inequities in the system, where it may fall unduly on X person or Y person, A organization or B organization, or whatever the case may be. We always do that.
So when people say, review the tax as though you are going to have some grand inquisition and invite people . . . to review the tax, it doesn’t work that way. We consistently review taxes. That’s what the BRA supposed to do and the Ministry of Finance, from a policy perspective.
When you put a tax in place, you put a tax in place for a particular purpose; and we have said what the purpose is for this tax. And our view is, where relief is necessary, the act provides for how such relief is done; it leaves it within the discretion of the minister, after the facts have been known and analyzed; because everybody that writes for relief doesn’t necessarily need relief.
There are some people who would write, just because they don’t want to pay the tax. Those ones that are legitimate will be given the relief necessary either in whole or part; those that simply do not meet the criteria, certainly do not comport themselves in a fashion as to suggest that relief is necessary, will not get it. But, generally, everybody should pay the tax.
I don’t want to encourage people to feel that, you know, as people go into this review thing, it makes it seem, ‘Oh, Government is reviewing it; so I aint paying it.’ No, no, that ain’t gonna work.
You have to pay a tax because you know the purpose it is for; and it is generally associated with our fiscal consolidation programme. So, frankly, we need those resources.
Who are some of the entities calling on you officially by writing letters?
Sinckler: I have not received as many as 50 letters yet. It’s early days yet anyway. We have received some, Mr [Owen] Arthur’s [Owen] 20 have come in. I have had a look at them myself. There are some legitimate cases in there.
Others, if I had to say off the top of my head frankly, I don’t think they would meet the bar. But I have asked to put a . . . have an internal committee in place and we will look at them as is the case with all other taxes.
I have had one letter from a church group; I’ve seen something from the National Trust; I’ve seen from some agriculturalists; and a couple companies, as well. Of course, you have had the generalized statements from the Barbados Chamber of Commerce and Industry on behalf of their members and I have also heard some comments issued by the president of the BHTA; and that’s the extent of it.
Now the church is a large organization. When you look at the letter the church group has written to you, how do you assess the need for relief.
Sinckler: Well, the one letter that I have received from one group of church organizations was arguing that they should not be eligible to pay the tax because they are a charity and that they as a charity don’t pay land tax. But that is land tax, that is not Municipal Tax. The general rule or consideration for us is that all people should pay tax, including the church.
The only people exempted, as far as I know, would be the diplomatic missions, because under the Geneva Convention, the law is, the rule is, countries don’t charge missions. The US government doesn’t charge our mission and we don’t charge theirs. But even in that case [church], I didn’t see any reason that would suggest to me, but the committee will look at it, but I didn’t see anything that would suggest to me that they should be given any relief . . . from that tax.
So there is no likelihood of the tax being reviewed in the short term . . . before the one year or 18 months are ended?
Sinckler: Anything is possible, but I don’t see why it is necessary at this time. If you want to make improvements . . . the law provides how exemptions can be made, or waivers can be made, and the basis of them . . . . But generally no, I don’t see that [review happening].
Have you actually done any relief as yet?
Sinckler: No, it’s early days yet; we’ve only received the letters this week [last week]. We can look at it and see. You know, there are some organizations who may lend themselves to serious consideration. We’ll look at that. The general principle is that everybody should pay. Who can pay should pay.
Now, the first half of the year has ended and we are into the second. How has the first half performed and what can we look forward to in the second in terms of the economy?
Sinckler: Well, we are going to get a report from the Central Bank, the Governor of the Central Bank. They do the general assessment of the economy. I believe it’s next week Wednesday or Tuesday –– whenever they do it [this week]. It usually comes around the middle of the month.
They report quarterly and they are putting together the figures and we will hear [this week]. I haven’t seen the final document, but I think generally, the situation has certainly stabilized in relation to our foreign reserves. I think we are basically on track with our fiscal programme for the first quarter of the financial year, which of course started April 1.
The other issues, sectoral and so on, the Central Bank will give a full report on that.
Give us a status report on the retrenchment programme. Have you reached your goal, or are there more workers to add on.
Sinckler: Well, I couldn’t tell you specific numbers, but I know we are substantially along the way to doing so. The last time I checked, we were just a few hundred short and those are coming in the system; will come in the system as we go on in smaller batches, rather than the bigger ones that you would have seen in the statutory corporations.
Of course, you have the dispute with the unions and the NCC ones [National Conservation Commission]. So those will come into the system, in terms of counting the numbers when that is finalized. But I would say, given the early teething problems we would have had in the process, some of which frankly could have been avoided, the process has basically run its course and has gone reasonably well. Could have gone much better.
What people must understand is that you are now dealing with a different type of culture. In 1991, there were a whole lot of categories called casual workers. It was easy to give people a one-week letter and let them go. These are public workers, some of whom were occupying posts even though there are temporary posts and they have rights as well, entrenched rights by law. So therefore it isn’t that easy to dismiss them.
One of the things I am happy about is that finally most of the people who have been retrenched have begun to receive their separation benefits. They have tapped into their unemployment benefits through the National Insurance Board and some of them have actually found jobs in the private sector and else where, not as many as we would have liked, but that is based on the performance of the economy in terms of businesses being able to bring labour on in the private sector.
Our job is to work as assiduously as possible to ensure we get the economy running at a pace where all of those persons who have lost their jobs can get them back.
What is the real number you had budgeted for?
Sinckler: I think we had said 3,000. And the last I checked, there were about, a good few weeks ago, 2,800.
Is it likely you are going to add on others to the number for any reason?
Sinckler: Not in that type of way. Of course, you know we said we are going to restructure 19 organizations within Government and that process is getting under way; and the consultations we’ll be doing with the union. So smaller [numbers] –– one or two here, three or four. They are not going to add up to the thousands, but you will get some attrition once that process begins.
How far have you reached with that restructuring process?
Sinckler: We are at a very advanced stage. We have established a committee headed by Dr Justin Robinson and including Dr Winston Moore from the University of the West Indies as well . . . Mr Chris DeCaires. Oliver Jordan is also on there; representatives from both major unions who have workers in the Public Service; Mr Jeremy Stephen who is president of the Economic Society of Barbados; he’s on that committee as well; and they’ve been given a remit to look at streamlining, to bringing efficiencies, both policies, management and operations of those statutory corporations.
Senator Jepter Ince has been detailed to carry that process from the policy end for the Ministry of Finance and the technical staff, the Director of Finance accompanying that committee in that work. The basic secretariat for assisting in that work is . . .we’ve brought in additional staff and they’re going to be working with the separate entities. Certainly the major ones, Transport Board, NHC, QEH; those ones, to ensure that we bring levels of efficiency to them, that they reduce their dependency on the public purse.
Has the committee actually started work?
What time frame have you given them to report back?
Sinckler: Three months.
So we’re looking at what?
Sinckler: By October. I mean, the changes will be ongoing. As they [committee] find things, they will be making recommendations for changes. That committee will report directly to the Cabinet and through the Minister of Finance, and we’ll be making changes on point, once the recommendations can lend themselves to that type of intervention.
Four Seasons. We haven’t heard much since the last announcement.
Sinckler: In relation to the Four Seasons, we are at an advanced stage of completing the deal for the sale of the property to a new group of investors.
Sinckler: Very advanced. The lawyers are basically finalizing the paper work.
How soon do you anticipate the deal being completed?
Sinckler: This year. It’s going to be signed this year for sure. In another couple weeks.
Are there going to be any structural changes in the design?
Sinckler:That’s going to be left to the new people. Government will no longer be participating in that way. In fact, part of the deal is to take Government and the NIS –– well, the NIS is just in for a very, very small amount –– to take both out completely. So it would be returned fully to the hands of the private sector, and it’s up to them to do what they want to do.
But I don’t anticipate that there are going to be any radical changes . . . . My understanding is, from the developers, that Four Seasons company is remaining on board; and, if that is the case, as I expect it to be, I don’t expect . . . any radical changes in the model.
$22 million for the QEH. I understand they had a first tranche. How soon will all be disbursed?
Sinckler: I believe they might have had a second tranche of $10 million already. So the total, they should be up to about $10 or $15 million by now.
Where is that $22 million coming from?
Sinckler: Government. Coming from Government. Where else is it going to come from? There is nobody else to give.
One wondered, with things so tight, how you could find that in such a short space of time?
Sinckler: Well, don’t forget that for this year, for this financial year, QEH has got every cent that they are supposed and expected to get. I think it’s about $36 million, and they’ve got it for this quarter already. But don’t forget what QEH had on its books are arrears owed to suppliers, as I understand it, from prior years or prior months. And our job is to work that down
as much as possible.
So if additional resources are available because the revenue is there, then we give them additional resources so that they can help pay down some of those arrears, keep current at least, and have their suppliers continue to supply.
When will the rest of the money be disbursed?
Sinckler: I don’t know. But, as the minister has said, over the next days; but they’ll get all.
Now, it’s been my understanding you have had some talks with Minister Estwick about his controversial proposals. Is that true and is there anything you can take away from them?
Sinckler: But I’ve always had conversations . . . .
Regarding that specific presentation he had made to Cabinet.
Sinckler: . . . With Dr Estwick. I saw the presentation before it was made. I spoke to him before he made it. I heard it when it was made; we spoke during the presentation and I subsequently had meetings with him after on that matter; and we see eye to eye on various aspects of it, as other colleagues in the Cabinet do.
Dr Estwick has full gamut and support from myself, the ministry to execute the elements of that programme that we think can impact positively on the economy. And I have given my full support.
You have actually taken some of it onboard?
Sinckler: Yes. That’s correct.
Sinckler: Well, there are aspects relating to tax policies, aspects relating to investments and looking for alternative investments. Those are the ones in particular that could give immediate effect. There are others that have more long-term germination and we continue to work on those assiduously.
That would include the UAE proposal?
Sinckler: And it’s not only UAE. Everybody emphasizing the UAE. Dr Estwick was giving an example of who and where you may get alternative resources from, as opposed to just constantly going to the capital markets and borrowing at exorbitant rates. I don’t anybody can argue with that logic because that’s something that makes sense.
So it’s not only UAE. He mentioned the Kuwaitis; he mentioned the Chinese, and so forth and so on. So we are looking at all of these in terms of an alternative financial structure that brings down the cost of the capital which Government has to engage for larger projects and major investments that are necessary for the country to spur economic growth and development.
If you had to say something to Barbadians who are worried about this Municipal Tax, to reassure them, what would that be?
Sinckler: Stay the course. It is painful in some instances when it’s inconveniencing. In some instances painful, but it’s absolutely necessary. Regardless of who is Minister of Finance, who is Prime Minister, who is Government, who is Opposition, this course of action absolutely has to be done. There is no escaping it.
So we can chose to do this in support of the country and ensure we get to the place where we want to be in 2015/2016 . . . get those investments like Sandals, Four Seasons, the greening project, Cruise Terminal, waste to energy plant –– all those nice things that are lined
up to be done.
If we don’t do this in terms of getting our fiscal programme, our fiscal situation under control, cutting expenditure and raising sufficient revenue so that we are living within our means, even at that level, then all of the other things, all these things people like to hear about, tourists coming, none of that will matter, because you will just be too unstable in order to achieve that.
So my own sense to Barbadians is, yes, we understand and appreciate the difficulties of it and the pain of it, but in this instance, the pain will lead to gain. And therefore we have to try our level best to help each other and to ensure that we can get through this as a country.
Sometimes if you are highly dependent on the global economy and it goes through a rough period, it’s going to impact on you. Sometimes you have to make adjustments. As one person put it, there is no Easter Sunday celebration without the pain of Good Friday. You have to go through Good Friday for Easter Sunday to make sense.
Sometimes you have to go through some pain in order to get where you want to get; and nobody likes it. I certainly don’t like to put measures in place that give people great discomforture, but sometimes it is unavoidable. So I would ask Barbadians to rally around their Flag, the country and the Government and themselves to execute the programme.
The Barbados Revenue Authority and the Bar Association are fighting over the linking of the land tax and the Municipal Tax. What is your take on that?
Sinckler: Well, I will leave that for the lawyers to sort out. But I would encourage everybody to read the Barbados Revenue Authority Act. Don’t just read the Municipal Solid Waste Tax Act and the Land Tax Act, read the BRA Act and see where it takes you. As I said, the BRA is a regulatory institution, I treat all regulatory institutions as all Ministers of Finance have, with a hands-off approach. We give directives of policy if necessary. That has to be approved by Cabinet.
But those agencies operate almost always semi-autonomously as well they should, because you don’t want politicians or any other persons meddling and getting involved and issuing directives to regulatory agencies, that undermine the system and is a sure recipe for disaster.
If there is an issue that the legal fraternity has with what the BRA has or has not been doing, . . . I don’t know . . . . People say they have gone to cashiers and cashiers have told them this [and that]; I don’t know. I would have to see that in writing . . . . But if there are issues there, then the BRA board under the competent leadership of Sandra Osbourne, QC, and the commissioner, are quite capable of discharging their duties without any interference.
The roadshow you went to in the UK and US. What have you brought back tangibly or intangibly?
Sinckler: Well, the roadshow was essentially to speak to our investors directly. We also often have to speak to them, because they often hear about us through the prism of IMF, Moody’s, Standard & Poor’s, and so forth and so on. And it is always good, even if you are not raising money, as is the case in this trip, to go and speak with your investors directly; the people who buy your bonds.
We do it every year; it’s a non-deal roadshow; no raising of any money. And they were very happy to have us come along. And they have a far better picture of what’s going and why we are doing what we are doing. And we are satisfied that it went very, very well, and what we have brought back is that people [investors] want to see Barbados do well. They have a lot of confidence in Government’s approach and Government’s programme.
But what they want to see is it fully implemented; because they believe that once it is, the benefits will come. And we believe that as well. So it was a good trip.
Any likelihood of going to market any time soon?
Sinckler: No we don’t have any immediate plans of going.