VAT Exemptions List Wider Than Other developing States

Written from sourced news

Prime Minister Gonsalves says the Government will be reducing the Value Added Tax (VAT) exemption list and the zero-rated listing of items, effective May 1st, this year.

Delivering his Budget Address in Parliament yesterday, Dr. Gonsalves outlined the items that will be made subject to the standard rate of VAT of 15%.

He noted that the list of VAT exemptions in this country is much wider than in other developing Small Island States.

According to Prime Minister Gonsalves this revenue measure is expected to yield eight million dollars per annum.

The Government will be increasing taxes on several items during the 2016 fiscal year in a bid to raise an additional 20 million dollars in revenue or 1% of Gross Domestic Product (GDP) to finance its ambitious plans for economic growth and job creation.

Prime Minister and Minister of Finance Dr. Ralph Gonsalves made the announcement as he presented the 2016 Budget which amounts to 912-million, 897-thousand 311 dollars, with a current account deficit of $11.9 million.

He said taxes will increase on beverages such as beer, malt, brandy, stout, wine of fresh grapes, whiskey and vodka; while tax on commercial properties will be increased from the rate of 0.06% to 0.08%, as of this current tax year, and will raise an estimated $300,000 per year.

Dr. Gonsalves also announced increases on motor vehicle and drivers licenses, as well as the surcharge on vehicles older than four years.

The Prime Minister said there will also be an increase in the fees for residence permits, work permits and gun licenses.

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