Closing the book on the TTRA

THE PRIME Minister’s May 3 announcement that the TT Revenue Authority (TTRA) Act will be repealed not only closes the chapter on a longstanding effort to merge the Inland Revenue Division with the Customs and Excise Division by the previous administration, but it would also appear to potentially stall the wider issue of reform when it comes to our taxation systems.

But the latter is a book the government cannot afford to close.

The PNM administration’s tardy reform process has laid the groundwork for this repeal.

While much of this is due to the legal challenges mounted against the TTRA, the fact that ten years were allowed to elapse after Dr Keith Rowley came to office in 2015 has left the door open for Stuart Young’s successor to dismantle what progress has been made.

Persad-Bissessar’s UNC campaigned with a "coalition of interests" that included trade unionists strongly opposed to the TTRA – former PSA president Leroy Baptiste is the Minister of Labour, Small and Micro Enterprises within her new cabinet.

UNC’s clear victory in the April 28 general election makes it very difficult for any future administration to revive this authority.

But the Prime Minister should not throw out the baby with the bathwater. The country cannot afford to see a reform vacuum open in the wake of any legislative repeal.

It is open to the cabinet to replace the existing legal framework in a way that serves both its coalition partners and the public.

The law should be amended to allow workers in the new entity to have access to trade union representation. That, after all, was one of the main grouses labour had with the measure all along.

The tabling of legislation to repeal the TTRA, which is supposed to be a semi-autonomous body, will be awkward.

The establishing act was passed in 2021, despite a lack of consensus. There is already an eight-member board of management in place, with a chairman and vice chairman currently serving five-year terms. The Privy Council last year, in a unanimous decision, ruled the provisions of the law to be constitutional. The TTRA has a three-year "strategic plan" in train.

Whenever a new government comes into office, the presumption of a mandate to depart from what has come before is strong.

In this case, it is even stronger given the UNC’s accommodation with labour and all the concerns expressed by the party over the years about the law.

However, it cannot be denied that there is a need for the state to improve the efficiency of tax systems, bolster revenue collection and tighten customs measures to stop illicit flows.

The tax gap is estimated to be as high as $10 billion and closing that gap could be essential in sustaining funding for grants meant to support the vulnerable in society, such as the disability grant.

It is all well and good to get rid of the TTRA, but other reforms must be put in place to shore up existing systems. The country cannot afford not to.