At the recent ECCB media practioners workshop, Montserrat and Anguilla were asked during discussions whether the UK had to approve our budgets. Montserrat participants read from the DFID statement just handed to us a few days earlier during the DFID press briefing following their budget discussions in mid-January.
Premier Meade may have well been privy to what the DFID team would have been saying to the press while he was at the same time speaking in the Legislative Assembly suggesting that coming out of the talks Montserrat was being made to feel like it was begging. He told parliamentarians that they were refusing to meet his full request for budgetary aid, but would give no more than they did last year.
Meanwhile the DFID team was telling the press that they had not yet committed any figure, but were waiting for the Government to, “finalise their revenue and expenditure projections taking on board our discussions.” Preceding that they addressed such issues as the shortfall in the collection of revenue so far in the current year, specifically referring to tax arrears.
We could not find out what the specific problem was with the collection of the tax arrears, but the Premier has threatened that he will go to the courts to collect those outstanding taxes. It appears that the sum anticipated to be collected fell short. From the Premiers strong, what he called “suicidal statements”, it would appear that there are persons still owing tax arrears and not paying. This must be after the tax negotiator had carried out his instructions to forgive as he negotiated, based on criteria unknown to us.
Whatever the specifics the Government is not pleased at the outcome of the budget talks and we are hoping we will get their side of the story soon.
Premier Meade while serving on the opposition side of the Legislature back in 2000 while David Brandt was Chief Minister was very critical of the him. “It is vital that taxes owed to government be paid,” the Premier reportedly told the DFID team back then.
Later CM Brandt had fired back as reported in a TMR front story captioned, “Meade Stirs Pot on Taxes, CM Fires Back” by Bennette Roach.
Meade had accused the Brandt government as, “a government that cannot make decisions.” . The story continued and this was attributed to the Premier: “On the tax matter he accused government of applying “pressure and more pressure for taxes that we owed. Why pressure for the taxes 1996-1999?” he asked.
He continued, “they should have cancelled the taxes, property taxes and income taxes owed in 1996-1999…the Government in compensation could then be more vigilant in the collection of taxes in the year 2000.”
Chief Minister Brandt, in response to a question from ZJB news editor on the vigilance of tax collection, said that the minutes of the meeting showed that on that subject, Mr. Meade said, “It is vital that taxes owed to the government of Montserrat be paid. This could be achieved if there is increased vigilance in the area of tax.”
Brandt told reporters accusing Meade saying, “…he comes and tell the people that we should ease up when it is he that is pushing the heat on the people of Montserrat…”
He said: “We cannot relieve the taxes unless Britain agrees or they would withdraw their support from us… We have argued with them for the forgiveness of tax or the suspension of tax for all these years and they told us the only thing they will consider is a reduction in the penalty and interest…When he goes on radio and say we can release the taxes, he knows we do not have that power.”
Eleven years later, Premier Meade is in the hot seat and we understand that part of the directives to the tax negotiator was to do exactly that, “give a reduction in the penalty and interest”.
The full story may be found in the archives for 2000 at www.montserratreporter.org.
It does appear that there was some problem with the promises the Government made as far as the amount of taxes they intended to receive. In the story referred to above we would find that the Meade was targeting employees as the plan was to use social security payments to determine their income. Today it may well be the bigger guys who are cause of the problem.
In 2000 Premier in Meade had called for “tax education”. There should be an urgent implementation of education programmes by the Inland Revenue department whereby the public would be informed about the process of tax collections, reasons for payment of tax and the requirement of tax returns. We have been calling for education of the people on this and many more.
Following a visit of head Department for International Development (DFID) officials from Britain there have been radio broadcast exchanges between the Honourable member for central Reuben Meade and Chief Minister David Brandt on the very touchy subject of taxes.
A ZJB news report first revealed that MP Meade met with the head of DFID (Montserrat) Mr. Mike Wood and his economist Mr. Keith Wood and others. Reportedly according to minutes of the meeting, Mr.Meade told the officials that “it is vital that taxes owed to government be paid.”
The Chief Minister confirmed the information later in response to a question about his reaction to Mr. Meade’s later statement on the radio.
The MP followed the news report with a political statement on ZJB in which he addressed several issues, among them no assistance yet to the hurricane distraught fishermen, no air links for Montserrat, no soft mortgage scheme, high food prices, and accusing the government of being, “a government that cannot make decisions.”
On the tax matter he accused government of applying “pressure and more pressure for taxes that we owed. Why pressure for the taxes 1996-1999?” he asked.
He continued, “they should have cancelled the taxes, property taxes and income taxes owed in 1996-1999…the Government in compensation could then be more vigilant in the collection of taxes in the year 2000.”
Chief Minister Brandt, in response to a question from ZJB news editor on the vigilance of tax collection, said that the minutes of the meeting showed that on that subject, Mr. Meade said, “It is vital that taxes owed to the government of Montserrat be paid. This could be achieved if there is increased vigilance in the area of tax collection.”
The minutes reportedly continued that Meade suggested that officers could be employed to enforce the tax laws…”There should be a link between the Social Security and the Inland Revenue department since there is an inherent culture in Montserrat whereby persons pay their Social Security payments rather than income taxes. Social Security payments are based on income levels; the Inland Revenue could use this information to upgrade and verify the income levels of persons which would have an impact on the important role it plays in the economy. There should be an urgent implementation of education programmes by the Inland Revenue department whereby the public would be informed about the process of tax collections, reasons for payment of tax and the requirement of tax returns.
The Chief Minister’s comments echoed those he has made on previous occasions, including his recent budget presentation: “We cannot relieve the taxes unless Britain agree or they would withdraw their support from us… We have argued with them for the forgiveness of tax or the suspension of tax for all these years and they told us the only thing they will consider is a reduction in the penalty and interest… And by him going to the British, tells us that he recognises that fact. When he goes on radio and say we can release the taxes, he knows we do not have that power.”
He said further that they (Mr. Meade and the opposition) are saying we must be more vigilant and people have to pay their taxes that is owed to government. “How could he be saying that people are not declaring their taxes and that Inland Revenue should go to the Social Security and see what people are paying and charge them more money?
“And then he comes and tell the people that we should ease up when it is he that is pushing the heat on the people of Montserrat… Why he did not say what the British told him.
He knows they told they will not do it.”
Mr. Brandt’s response on the matter was aired directly following the paid for political statement by Mr. Meade. In the statement Mr. Meade said that the new team of the National Progressive Party (NPP) is willing to take on the challenge to put the country back on track.
The Chief Minister, meanwhile, travels to Trinidad today to join Caribbean counterpart Tourism ministers in a meeting to discuss funding of tourism projects.
