The Co Chairman of the Barbados Economic Recovery and Transformation (BERT) Monitoring Committee Ed Clarke is urging the Government to look for new sources of tax revenue.
Presenting the findings of the first public quarterly report of the committee at the Sagicor Wildey offices this morning, Clarke warned that Barbadians cannot afford to be continually taxed from the same sources all the time.
Clarke also said he hoped an increase in taxation would not be necessary at this time.
“We are hoping that that is not the case. We need the taxation level to come from new revenue streams; new growth. The level of taxation as we all know in Barbados is extremely high as it is,” Clarke said in response to a reporter’s question.
He noted that a tax reform initiative was underway, while referencing the presence of a team from the International Monetary Fund (IMF) which is in Barbados assisting the Government in this regard.
“We are not sure what is going to be the outcome. So, obviously the Government may have to re-jig its tax structures and the strategy around tax revenue. So we are eagerly awaiting the outcome of that team.
“We are working with the team,” he stated.
“But I do not think additional tax revenue should continue to come from the same sources at this time. It has to come from new sources of revenue,” he emphasized.
For the period April to December 2018, Barbados’ total tax revenue was $2.078 billion, a shortfall of $56 million of the target set by the IMF under the BERT programme.
Clarke reported this morning that direct tax revenue was $730 million versus $750 million targeted.
The BERT Monitoring Committee Co Chair reported that while gross direct tax collections exceeded target, higher than planned refunds drove the shortfall.
With respect to indirect taxes, Clarke said the $1.178 billion in revenue achieved, was $36 million or 3 per cent less than the $1.212 billion target, largely due to lower than expected value added tax (VAT), excise tax and duties.