Payouts from ‘next week’ as govt mulls VAT holiday

Thousands of low-income taxpayers are set to receive a financial boost this Christmas, with government payments for the $1 300 Reverse Tax Credit (RTC) scheduled to begin as early as next week, the Ministry of Finance confirmed on Friday.

The RTC is paid annually in December to qualifying residents and is designed to provide extra cash during the holiday season. Eligible individuals should see the funds deposited directly into their bank accounts or sent by mail.

Minister in the Ministry of Finance Ryan Straughn said: “In December, payroll is usually a week earlier than normal, so this year it will likely fall around December 18 or 19.”

He added: “Once people have provided the correct bank account information, payments will go straight into their accounts. Those without bank accounts will receive the credit by mail, which may take longer.”
Straughn noted that late filers are still eligible within a two-year payment window, but he encouraged timely filing to ensure faster processing.

The most recent Reverse Tax Credit (RTC) payments made to Barbadians were in December 2023 for the 2022 income year.

The finance minister also confirmed that the government’s one-time Solidarity Allowance has largely been distributed. Over 200 000 taxpayers received $300 via bank transfer or cheque as of October.

Straughn said: “We transferred all the money that National Insurance requested through the registration process. A few people may still be undergoing reconciliation, but the vast majority of the allowance has been paid.”

When asked about the possibility of a VAT-free day, Straughn said it was under consideration. It was originally introduced to help residents during the pandemic, he said.

“We were conscious of the pandemic’s impact a few years ago, and that was the basis for it then,” he said. “The economy is growing reasonably well, with more tourists, higher employment, and minimum wage increases in June and January. We’re confident things will hold, but any consideration of a VAT-free day will come at the appropriate time.”

Louriannegraham@barbadostoday.bb