Imbert: TTRA desperately needed with covid19 and falling oil

FINANCE Minister Colm Imbert said the TT Revenue Authority (TTRA) is desperately needed as the country faced the economic impact from covid19 and falling oil prices.

"What has happened in the last week underscores the reason why it is now imperative that we, as a country, move to a much more efficient system of revenue collection," Imbert told the Senate as he piloted the Revenue Authority Bill Tuesday.

He explained the bill would merge two revenue collection agencies, namely Customs and Excise Division and Inland Revenue Division "into an efficient and effective revenue administration that is robust and flexible to adapt to changes in national and international environments."

He continued: "It couldn't come at a better time. We had some discussions today outside of this Senate and inside this Senate about what we as a country should do to deal with the revenue shortfall that will come as a result of the collapse of oil prices, resulting from the covid19 epidemic and the associated problems which include the disruptions to supply chains that have already damaged world stock markets and damaged demand for commodity products, especially consumers of energy such as China."

He stressed there have been a number of attempts to look at the tax administration and, despite all of those attempts over the last 20 years by different governments, PNM and UNC, there is still an unreasonably high incidence of corrupt practices, poor customer relations, anti-business rules and regulations, inefficient human management, inadequate training, inadequate information exchange between various agencies, lack of control over budget allocations, inadequate employee compensation packages and inadequate staff development.

Imbert said the Opposition has objected to the TTRA saying that reform can be done within the existing arrangement.

"That is just pie in the sky."

He stressed this was done for 40 years but has failed.

The minister reported that both the Board of Inland Revenue and Customs were severely understaffed with hundreds of vacancies. He said a vacancy takes two years to fill and members of the Opposition have asked him for assistance to get someone in the queue.

Imbert said every year millions of dollars is put aside for vacancies that are not filled and there is a 50 per cent vacancy in critical areas in both Customs and Inland Revenue.

He reported more than 60 countries worldwide have moved to a semi-autonomous revenue authority.

Imbert explained that the VAT tax gap assessed by the International Monetary Fund was five per cent of GDP or $8 billion. He said half of this was the policy where basic food items were exempt from VAT but the other half was due to problems with enforcement.

"Imagine if we have that extra $4 billion."

He said there was also the false premise that the Finance Minister would be able to get into people's tax returns but nothing could be further from the truth. He added that not even the TTRA board had that responsibility but only the director general, a post that would be appointed by Parliament similar to the commissioner of police and not by the Cabinet as currently obtains.

"This is a vast improvement."