Trade union leader and Parliamentarian Toni Moore has taken Government to task for failing to take action to collect almost $1 billion in unpaid taxes and allowing delinquent businesses to escape with a slap on the wrist.
In fact, she suggested on Tuesday that if the current administration had put more emphasis on tax enforcement, the Pandemic Contribution Levy now being imposed may not have been necessary.
Although repeatedly stating that she supported the Pandemic Contribution Levy Bill, 2022 in Parliament on Tuesday, Moore said it highlighted the consequences of lack of tax enforcement by successive governments.
She pointed out that the Barbados Revenue Authority (BRA) which is responsible for enforcing the payment of existing taxes is the same agency tasked with ensuring that businesses, employers and self-employed persons pay the level of Pandemic Contribution Levy required under the legislation.
The penalty for non-payment of the levy is $500, in addition to a one per cent monthly interest – the latter which Moore pointed out exists for non-payment of other taxes.
“If we have similar penalties in place for other taxes that are not being collected, and we still have outstanding as much money as we do in uncollected taxes, it tells you that something in the system is not as effective as it ought to be, something in the system is not working,” she insisted.
“This causes me concern . . . because we have had to impose another form of tax . . . to collect monies to help us through a crisis, when available to Government, in terms of outstanding monies, would be Value Added Tax (VAT), income taxes, employer contributions to National Insurance.
“There ought to have been monies available to tie us over through difficult times, and even if a pandemic levy had become necessary, that levy could be building on top of what was there.”
While giving the Mia Mottley administration kudos for “doing many things well”, the Barbados Workers’ Union (BWU) General Secretary insisted that if the government was simply putting plasters on sores rather than dealing with the root of the problem, it was failing itself and the people of this country.
Again stressing that she supported the Pandemic Contribution Levy Bill, 2022 under which workers earning $6 250 monthly were required to pay one per cent of their income toward the tax, Moore said one could not blame workers who fell into that bracket who felt hard done by when companies failed to pay their fair share of other taxes.
“When you have to make this level of sacrifice and you are seeing companies that can do better and ought to be doing better, not doing better and getting the proverbial [slap] on the wrist, how does it register in your mind regarding what government ought to be doing for you that it isn’t doing for you?” she pointed out.
Moore insisted that a responsible government is obligated to collect what is owed from all who owe.
“A major beef of mine is that successive administrations in government would be administering over a system that recognises people are not doing what they’re supposed to do, that would have laws in place to enforce sanctions against organisations and people who refuse to do what they’re supposed to do, and will speak in board terms of all the measures that we will put in place to correct it, and when you trace back through history you can’t see much in terms of implementation that has led towards a narrowing of the gap…,” she contended.
“Why is it so hard to do?” further questioned the trade unionist who is among 30 Members of Parliament in an administration now into its second term in office following the Barbados Labour Party’s second consecutive clean sweep at the polls.
“If a government that has been given the responsibility twice, with all, cannot make the corrections, cannot close the gaps on the fundamental things of importance, then I don’t have hope that I would see it in my lifetime.”
Moore acknowledged the benefits of amnesties extended to individuals and businesses under which interest and penalties are waived but contended that the authorities had to take action when people continued to default.
“So that after the period of amnesty is up and people are still not paying up, we move into enforcing what the law provides for, and if the law doesn’t provide for enough then we come in here and make sure that we bring amendments to give teeth to the law,” she said.
Moore, therefore, made an appeal to fellow Parliamentarians with ministerial appointments “not to let your term in office end unless you narrow the gaps on some of these very large cracks in the public administration system especially as it relates to enforcement”.
The MP said an integrated and comprehensive response, that factors in not just initiatives like the Pandemic Contribution Levy but addresses the issues such as non-payment of taxes and other obligations is necessary for Barbados to “recover and build back better”.
Minister in the Ministry of Finance Ryan Straughn, who had earlier introduced the Pandemic Contribution Levy Bill, 2022, responded to Moore’s concerns with an assurance that Government had not dropped the ball when it came to collecting outstanding taxes.
He reported that even during the COVID-19 pandemic, people had been engaging with BRA to settle their arrears.
Straughn said VAT owed by the private sector now stands at approximately $226 million and work will be done over the next few years to resolve that debt.
“We have been working with individuals as well as businesspeople in the pandemic to make sure that we can keep the payment and settlement of those arrears to Government coming in,” he said.
“I give this honourable House the assurance that we will continue to work with the private sector, both as it relates to tax obligations, but critically as it relates to the National Insurance contributions.
“If we’re able to see the economy recover and recover quickly, then I’m absolutely confident that those tax arrears from the private sector and individuals would be paid down, such that this longstanding issue of this almost billion dollars in taxes owed to government . . . we can put to rest and make a decision with respect to what is truly due and owing and to put everything on an even keel with respect to the tax situation.”
He added that if government was heavy-handed with its tax enforcement, many businesses would have to close their doors.
The Minister said the administration was therefore trying to work with those establishments to allow them to continue to keep their doors open and people employed while paying their obligations.