The Barbados economy cannot take any more taxes.
This sentiment was echoed today by businessman Dereck Foster, who noted that the Barbados economy needed instead was the creation of more businesses, to generate more economic activity and more employment.
Foster, one of the founders and senior executives of Automotive Art, made the point as he addressed the launch of the 2015 Trident Angels Investor Network at the Cave Hill School of Business. His comments come two weeks before Minister of Finance Chris Sinckler is scheduled to present the Government’s 2015-16 budget.
“We want businesses that are going to generate employment. For our country to grow, we need to create wealth. The Government continues to tax us and take money out of the economy, which will become a major problem,” said Foster.
“There is going to be a tipping point. It is probably now . . . but there is a point where people can’t take any more [tax] and you can’t tax a country anymore because it is going to continue to shrink. In my opinion, we are beyond that point. So we need to create wealth so that the Government can collect taxes from the successful businesses and the people who are employed,” he said.
A number of residents has expressed fear that there might be some new taxes in the forthcoming budget. Economists and business groups have already indicated that they do not support any move to increase the tax burden.
While acknowledging that the Government needed taxes to run the country and to improve and increase services offered to citizens, Foster pointed out that taxing the population was not the solution. He suggested the population was already over-taxed.
“I don’t think that is any secret. Over the last couple of years, we have had to implement a number of new taxes to pay Government debt. Think about it this way, every dollar that we move from somebody to go into new taxes is going to be a challenge for an economy. My belief is that governments don’t grow economies, private sector does, and if you are taking money out of the spending power of the private citizens, eventually it is going to harm the economy,” explained Foster.
He said it was the intention of the Barbados Entrepreneurship Foundation (BEF) to help to grow the economy through its Trident Angels Investor Network programme.
“I am hopeful that through this process, we will get a lot of new businesses started that could help grow the economy because new businesses employ people and pay taxes among other things. So the more new businesses we could get started or even businesses that are running to take them to the next level, they are now employing more people and looking at new markets [and that] could only be good for Barbados and for everybody. I am hopeful that we could use this to start and grow new businesses,” said Foster.