Between April last year and February this year the Barbados Revenue Authority (BRA) paid out a total of $170 million.
Minister of Finance Chris Sinckler said most of those payments were income tax refunds, pointing out that in any given year the amount paid out for income tax could be as much as $80 million or in excess of 50,000 payments.
He was speaking to reporters on the sidelines of the launch of Scotiabank’s 60th anniversary celebrations at its Broad Street location this morning.
While acknowledging that Government was still experiencing cash flow challenges, Sinckler said he was satisfied that the process of making refunds was in train.
“If the cash flow is tight for whatever reasons, Government debt payment, Government’s social safety net programmes, certain strategic operations in the society, such as transport, sanitation and so on, then that has an influence or impact on how quickly those returns are paid out,” he explained.
“It is not that the Government has the money and not wanting to pay it out. It is that sometimes you have tightness in the cash flow and therefore you have to look at the priority issues or rank things in order of priority and then deal with the most critical first and then work your way down,” he added.
The original goal was to have all refunds paid by the end of the last fiscal year, which concluded on March 31. However, as residents start to file their returns for income year 2015, some are yet to receive their refunds for the prior income year.
Sicnkler however, gave the assurance that the majority of the 2014 refunds had been paid and that payments were continuing.
“I believe that we have reached critical mass where that is concerned. There are some that are still to be paid. The reverse tax credits are being paid as well,” he said.
Also giving an update on the removal of the Consolidation Tax, Sinckler said that would result in a shortfall in revenue of approximately $30 million to Government.
However, he said he hoped that with “more disposable income” in the pockets of Barbadians they would be encouraged to invest more.
As Government continues the process of tax reform, he also said more changes could be expected to be announced in the upcoming Budget.