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Parliamentarians happy with withdrawal increased road tax
St. Maarten – By providing the receiver’s office with a mandate, the government is able to collect 13 million in tax arrears from the casino-sector, Finance Minister Richard Gibson said yesterday afternoon during a meeting of the Central Committee where he, as announced on Wednesday, withdrew the draft law to increase the road tax in 2016.
In a brief introduction, the minister told parliament that he would like to make some changes to the draft the previous government had submitted. Later on however, he said that he was not at all certain that he would bring the draft legislation again to parliament.
Minister Gibson reiterated that the current draft does not consider the social impact of the higher road tax. He prefers to revamp the draft and put something together that better meets the needs of the people.
Members of Parliament in general supported the minister’s proposal to withdraw the legislation.
“If there is a tax-increase, people should be given a 1-year notice so that they can prepare themselves for it,†MP Frans Richardson said. He supported the concept heavier taxes for luxury cars and he said that making a difference in taxation between diesel- and gas-powered engines does not make sense anymore. “Diesel cars are as clean as gas-powered cars these days,†Richardson said.
He also pointed out that any change in the road tax ought to be coordinated with the French side. All the same, the draft law had surprised Richardson: “The previous minister never brought this up. That was a bit of a shocker.â€
Dr. Lloyd Richardson asked the minister’s attention for another aspect: the damages caused to the road network by heavy equipment. “They cause far more damage that small cars and the big companies that own this equipment could easily pay a higher fee – 1,000 to 2,000 guilders,†he said. The MP referred to the repairs that were necessary on the Soualiga Boulevard that is frequented by heavy lorries taking garbage to the dump to illustrate his point.
MP Leona Marlin-Romeo asked whether the end goal, after changes to the draft, was still to increase the road tax. She also made a plea for better roads. “There are far too many cars on the island. When will you address that? We are constantly stuck in traffic.â€
Christopher Emmanuel asked the minister “to keep in mind the people that are struggling,†adding that he is happy that the draft will be withdrawn.
MP George Pantophlet focused on other sources of revenue for the government. “The government-owned companies – Gebe, TelEm, the airport and the harbor – should start contributing,†he said “There are also people renting homes for as much as $15,000 a month – and we don’t see a penny from it.â€
MP Maurice Lake also addressed alternative sources of revenue. He mentioned a marina in Simpson Bay that is supposed to pay for the water rights it is using. “The owner told me that she has put the money in an escrow account, but the government does not collect it,†he said. “The money is right there.â€
Lastly, MP Lake said that fees for residence permits should be nonrefundable. “Right now, if someone is turned down, we give them the money back,†he said.
MP Lake furthermore referred to the option of a tourist driver’s license, a vehicle registration fee, and levies on the export of cars and money transmitters.
The MP said that some long lease canons are not being collected either, due to the fact that these dues are not in the system at the Receiver’s Office. “There must be a better coordination between domain affairs, the receiver’s office and the tax office,†he concluded.
“Don’t fall into this trap. Don’t own this tax,†MP Rodolphe Samuel warned Minister Gibson. He referred to observations by former Finance Minister Roland Tuitt, who had his eye on the casino sector, on numbers game operators and on the possible establishment of a sin tax as alternative sources of revenue.
MP Samuel also pointed to government-owned companies. “I heard that TelEm is making a profit of 70 to 90 million and that the employees get a share of that profit,†he said.
He warned against a possible flight of drivers to the French side to evade higher road taxes. Switching to French plates has however a downside: insurance on the French side is much more expensive than it is on the Dutch side.
MP Sarah Wescot-Williams gave up her seat as president of Parliament to MP George Pantophlet to contribute to the debate. “The argument used in this draft is wrong,†she said. “It basically says that we should be grateful because the inflation (between 2000 and 2015 – ed.) was 41 percent and the proposal is to increase the road tax only by 18.18 percent. Where does it say that the road tax will be increased based on the inflation?â€
Wescot-Williams said that the government should make sure that the economy grows, instead of raising taxes. “Your focus should be on growing the economy, anything else is a stop-gap measure,†she said,
The MP briefly referred to the third quarter report that shows how personnel cost in 2015 decreased by 8 million guilders and how the parliament’s expenditures had stayed below budget, even though personnel costs had increased by 1 million due to the political pensions that are due to former politicians.
Minister Gibson did not get into answering specific questions but noted that across the board the parliament agreed that the draft should be put on hold. “You confirmed to me that a pause is the right step,†he said. “I am not certain that this will come back to parliament.â€
The minister did address the issue of the inflation: “You cannot argue in this context about the inflation alone. Since 2000 the number of cars on the island has increased significantly and that has brought in more road tax.
“There is 13 million in tax arrears owed by certain businesses,†Minister Gibson said. “Against that background, I have a problem raising the road tax to collect just 1.6 million. Steps have already been taken to collect these tax arrears.â€
