SAYING the budget deficit would continue to be large due to the gap between revenue and expenditure, Movement for Social Justice (MSJ) political leader David Abdulah said government should adopt an “aggressive push” towards the collection of existing taxes and not new taxes.
Trinidad and Tobago’s budget deficit, according to the 2018 budget statement, stood at TT $12.6 billion.
Addressing a media conference at the MSJ’s St Joseph Road, San Fernando headquarters yesterday, Abdulah said government has been “banking” on the implementation of the Revenue Authority as the “panacea and the solution to the country’s revenue problem in terms of collecting more taxes.”
However he said focus should be on ensuring that those persons who “ought to be paying taxes pays the correct amount of taxes.”
He said a simple exercise involving the cross referencing the TSTT yellow pages with the list of companies at the BIR could significantly update the tax rolls.
“Simply by hiring 450 young graduates and interns out of the universities and secondary schools to walk the streets and identify with a GPS map every business on a street and to see if they are registered with the BIR and are paying taxes,” he said.
“There is a list of tax rolls of tax payers which could be more accurate and BIR could go after persons who are not compliant or paying taxes that are below what they should be paying.”
He said this would also assist in rooting out those businesses which were involved in money laundering.
“If there are businesses which are showing large physical assets but very little transaction activity then we need to get the Financial Intelligence Unit to investigate and see what is going on there because maybe there is money laundering taking place,” he said.
“There needs to be an aggressive push towards tax collection and citizens ought not to be upset about that because it is necessary in order to provide the goods and services that we all need.”
However he said government had to “account properly” on how its monies were spent and recalled that “one of the issues the auditor general picked up from news reports is that the government spent $700 million and $1 billion on renting properties and a number of those properties there was no lease agreement and no approval from Cabinet for such renters.”
“That use of public money is not good and we should ensure that we get value for tax money that we have to pay.”
Abdulah predicted that there were three items which the Finance Minister would present in his mid-year review. “He would give an updated data on the economy, he will talk about inflation is very low, new gas projects coming on stream so the energy sector is growing and that’s going to yield more foreign exchange so he’s going to give data about the state of the economy.”
“He will also present data about the government’s fiscal position - returns from the Clico Investment Bank, and government getting some money there to help close the fiscal deficit,” he said, adding the last item would be to make changes in the allocations between ministries and in the various ministries budgets.
“Even as the pie is getting larger, the gap between the rich and the poor also got humongous larger,” he said, adding, “The majority of people in this country are barely able to survive from month to month or from week to week where at the same time there are others who can afford to change their luxury SUV’s every two years or so.”
“So there is a huge gap between the rich and the poor and that gap is getting wider and wider,’ he said, adding, “you have people working for minimum wages, three thousand per month or less which they cannot survive on and we have 25 percent of the population either below the poverty line or just barely above the poverty line,” he said.