A regional accountant today urged informal business operators in Barbados and the rest of the Caribbean to regularise their status now by formally registering as companies and paying taxes and fees.
Allison Peart, a Jamaica-based taxation and business strategist, suggested that businesses in the informal sector stood a better chance of surviving the COVID-19 pandemic and getting back in operation soon after if they were able to receive help from governments and development institutions.
Peart also called on governments to use the current crisis to move all their payments systems online.
Peart was a panellist on the weekly Inter-American Development Bank Caribbean webinar session on Monday on the topic: The Caribbean and Coronavirus: Options for Businesses.
She said: “Determining who is who is very important. So in terms of rebounding, the informal sector does feed off the formal; it is just for whatever barriers they are not in. So my advice if you are informal, now is the time to get yourself sort out. Get yourself ready to become formal because if you don’t you may miss the boat.
“If they are a part of a sector that is registered and paying taxes, people know about them and they are the ones that are going to get the help from the Government or from any organization that is helping.
She said while the process could seem daunting, it was up to the individuals to seek help and do the necessary research.
Peart pleaded: “Now is the time to get that done because once we get through COVID-19 it is going to be very dicey in terms of speed, in terms of getting into the net of providing pertinent services.
“So I think the informal sector will get punish simply because it feeds off the formal. If you are informal and you are legal, please come into the net.”
Pointing to the industries she believed were more adaptable to current circumstances and would become more critical post-COVID-19, Peart said they included agriculture, delivery services, cleaning services, online schooling, and financial management, adding that “it will be interesting to see how the legal profession and the accounting profession pivot”.
But calling on leaders to create opportunities for “better use of agriculture land” and technology and innovation, the accountant said: “In the Caribbean, we have the brightest mind and we need to use them now and not use this time to wait and see what comes out North America or Europe. We need to look at our own innovations and see what we can do better.”
She said now was the opportune time for regional governments to start or complete the shifting of their payment systems online in order to make the process of doing business process easier.
She said: “We also need to educate our people because some of us if we don’t feel the money or see them stamp our documents to say our taxes have been paid, we don’t believe it is going to be reflected. So we need to have the governments stepping forward and doing a lot more online training and access.”
Also on the panel, President of the American Chamber of Commerce of Guyana, Zulfikar Ally, warned that the private sector should “expect a new normal”, adding that after the pandemic they would not be able to “go back to what we are accustomed to”.
Using Guyana as an example, he said several firms have been forced to adapt to greater use of technology “in order to survive, remain open and remain relevant during the COVID-19 crisis”.
“We are seeing those businesses that cannot adapt to those changes are doing terribly. They have to fire their employees. So I think coming out of this COVID-19 crisis you will find the small and medium-sized businesses standing up are the ones who were able to adapt to what is going on right now,” said Ally.
Pointing out that regional economies would no longer experience positive growth rate for 2020, with the exception of Guyana, Ally said: “It will not be business as usual within the next year to two”.
Ally, who is the Corporate Secretary of Guyana-based Queens Atlantic Investment Inc., said he realized manufacturers have been forced to cut work hours of employees by implementing a shift system during the pandemic, and he is calling on all private sector employers to first consider cutting hours or reducing salary before reverting to layoffs.
He also called on regional governments to help business operators especially those in the micro, small and medium-sized enterprises sector.
Ally said: “After this is all over, find incentives and ways and means of getting people who would like to invest, especially the SMEs. Help them and hold their hands and encourage them to invest and start-up businesses. So whether it is tax waivers, deferral of national insurance or VAT so that small businesses and investors who would want to set up businesses they could have a start.”
Adding that the process will require the help of all stakeholders, Ally said: “It has to take governments, private sector, civil society and our international partners all working from one strategy to get this done, and if we do this correctly there is no turning back for the Caribbean”.
marlonmadden@barbadostoday.bb
