Imbert: New ways to pay property tax in the works

FINANCE Minister Colm Imbert says solutions are being worked on to address the challenges people are experiencing in paying their residential property tax by September 30.

Imbert was responding to questions from independent senators Dr Paul Richards and Sunity Maharaj in the Senate on September 17.

Richards asked whether additional payment options and physical locations were being explored to alleviate the long waits and queues people encounter when they go to pay their tax.

Imbert said, "In terms of locations, there will be no additional locations before the 30th of September."

Payments are currently made at district revenue offices throughout the country.

But he added, "Efforts are being made to expand the capacity of existing locations."

He said providing additional payment options for property tax is complex.

Property tax, he explained, is revenue, "So unlike your water bill, your electricity bill...which we are all accustomed to paying online...when the payment is remitted to the relevant statutory authority, the financial institution deducts an appropriate percentage as a service charge tor facilitating a transaction."

Under the Audit and Exchequer Act, he said, revenue must be sent in whole.

"There can be no deduction of a service charge."

Imbert told senators a possible solution being explored is to have the commercial banks act as revenue collectors.

"Someone could make an online payment. The banks will collect those payments of property tax, record them appropriately. identify who paid for what, when and so on and then remit the amount paid in full to Treasury to go into the Consolidated Fund for it to be recorded as revenue."

The banks would then send a bill to the Finance Ministry "for the service charge, so that the payment of revenue will always be 100 per cent. There will be no deduction from it."

Imbert said another challenge is that systems must be in place "to ensure that the payment of the property tax is properly recorded as revenue."

He recalled the source of the problem between the Auditor General, the Central Bank and the ministry is a question of accurate recording of revenue.

He was referring to a $2.6 billion understatement in revenue in the 2023 public financial statements to Parliament. Disagreements between the ministry and the Auditor General over this have led to court matters.

He said, "So what I would not want to happen is a situation where people make their property tax payments online and it is not properly recorded as revenue in the Consolidated Fund.

"Then you will get another report from the Auditor General that will start another set of confusion and bacchanal."

Imbert told senators a solution was imminent.

Richards acknowledged the solution Imbert outlined could involve in-person and online elements which involved commercial banks. He asked for a timeline for implementation of the latter.

Imbert said, "The process that we are working on, it will be an online process. It will be virtually identical to the online payment by bank transfer of your utility bills.

"So those persons who have the facility to use their bank account to make a bank transfer, as is now done with WASA and T&TEC and so on, will be able to do that. That's the process."

Before coming to the Senate, Imbert continued, he spoke with the technocrats who are working on the solution to make sure it is properly recorded.

He repeated that two things must happen.

"When the person pays the tax, they must get a receipt from the Board of Inland Revenue (BIR) to confirm that they have paid the tax, because if you don't get that, you can end up in an argument, and then there could be even more confusion with respect to penalties and interest."

The second thing to be addressed is a proper recording of revenue in the Consolidated Fund.

He repeated, "We are almost at the end of a solution that will deal with both (issues), so that when you pay online, automatically within a minute or two, you will get a receipt confirming you have paid this tax."

Imbert said this receipt can then be presented to BIR to confirm payment of property tax. Should there be a query, this can be addressed and the payment will be properly recorded as revenue in the Consolidated Fund.

Imbert said additional solutions for the payment of the tax, using credit and debit cards online, are being explored.

Richards asked if in light of these challenges, the deadline for the payment of property tax would be extended.

He estimated there are 400,000 eligible residential properties to be taxed and approximately 175,000 valuation notices were issued by the ministry.

Imbert told Richards that Opposition Senator Wade Mark had filed a question to him on an extension of the deadline.

"I don't want to get between you and Wade Mark. So let's wait for him to ask that question."

Maharaj asked whether the deadline applied to homeowners who have not yet received their notice of property-tax assessment.

Imbert said he received a legal opinion from the BIR and the Treasury Solicitor's department in his ministry on this issue.

Reading the information from his phone, he said, "If the failure to pay the tax did not result from the fault of the taxpayer, then the person is not liable to penalties or interest."

Maharaj asked Imbert for a simplified answer for people who may not be legally knowledgeable.

He reminded senators that the rate of property tax had been reduced from three to two per cent, so anyone receiving an assessment based on the three per cent value has received an invalid assessment.

He added that in cases where the BIR has been unable to deliver a tax assessment notice to a taxpayer, "Then the taxpayer is not at fault."

In these circumstances, homeowners will not be subject to penalties or interest for non-payment of the tax.

Mark did not have a chance to ask his question, as Senate President Nigel de Freitas said the time for urgent questions had expired.