The leader of one of the island’s new political parties is on Government’s side in the standoff between the Barbados Bankers Association (BBA) and the Barbados Revenue Authority (BRA) over the requirement of tax clearance certificates for financial transactions.
Grenville Phillips II of Solutions Barbados has insisted that citizens must pay their taxes and once Government is operating above board, then he saw no problem with demanding that individuals and corporations be fully paid up in their tax obligations in order to get a tax clearance certificate for real estate and other transactions.
His support comes amidst strong opposition from the BBA, attorneys, the Barbados Estate Agents and Valuers Association, and Opposition Leader Mia Mottley who have complained that the amendments to the BRA Act, under which the certificate was introduced, have created a gridlock in the sale of properties.
The bankers’ association announced last week that due to a “lack of clarity” on the processes involved in the issuance of the certificates, commercial banks had to suspend $221 million worth of real estate-related transactions.
Minister of Finance Chris Sinckler described the decision as “unfortunate and unwarranted” and was adamant he would not pull back the BRA Act amendments.
Phillips said Sinckler may be on solid ground.
“The estate agents would have to explain if they have been treated unfairly in the marketplace. If the estate agents have not been treated unfairly in the marketplace, if the Government does not choose estate agents to give the work to, then the Government has a strong case requesting that all real estate
agents provide tax clearance certificates,” Phillips said.
“However, if the Government picks the winners and therefore decides who the losers are, then the Government does not have a good foundation on which to stand. The Government has a very good case if it was not meddling in the sector. Once there is a tendering process we must assume that it is fair. Everybody must pay their taxes to participate in the economy. That’s the price a citizen pays to participate,” he added.
Phillips suggested that as a gesture of goodwill, Government should have granted a tax amnesty last year, during the country’s jubilee Independence celebrations.
“Any taxes owed should have been waived at that time,” he said, adding that an amnesty for all delinquent taxpayers was one of the planks of Solutions Barbados’ platform.
“Having benefited from the amnesty, the taxpayer who becomes delinquent again will be asked to pay a penalty of ten times the taxes owed,” Phillips explained.