The government of St. Vincent and the Grenadines has announced a tax amnesty program that, would allow people or businesses that are behind in paying state taxes to do so now without facing sanctions.
Minister of Finance, Camillo Gonsalves in presenting his 2018 Budget Address in Parliament, yesterday, said the Inland Revenue Department (IRD) will administer the program to delinquent taxpayers from now until May 15, 2018.
He said at present the government is owed approximately 300 million dollars in taxes, inclusive of interests and penalties.
According to the Finance Minister, that figure is close to 50% of the budgeted current revenue and 28% more than the entire planned capital expenditure for 2018, adding that it is unacceptable that law abiding tax payers are being asked to subsidize the cost of such massive non-compliance.
Minister Gonsalves explained that of particular concern, is the failure of some employers and businesses, to pay over Value Added Tax (VAT), PAYE and withholding taxes to the government.
“Today outstanding VAT and PAYE amounts to $58.2 million,” Gonsalves told legislators.
He made it clear that “businesses that charge customers VAT and then pocket it instead of remitting it to the government are committing a criminal offence.”
“Further in illegally keeping VAT money essentially as working capital they are giving themselves an unfair advantage over fellow businesses that submit VAT in compliance with the law. The arguments are similar for PAYE,” said the Finance Minister.
Non-compliant tax payers are encouraged to take advantage of this tax amnesty by going to the Inland Revenue Department to negotiate payment plans and settlement options in exchange for a waiver of a percentage of interest and penalties.
Minister Gonsalves said that at the expiration of that tax amnesty, the Inland Revenue Department will immediately commence collection procedures against those who did not negotiate appropriate arrangements to settle their arrears or those who breech the terms of their payment plans.
He further noted that this year’s Budget makes provision for the hiring of three additional High Court bailiffs who will be assigned exclusively to assist the Inland Revenue Department to strengthen their collection effort.
Additionally, he said that where the facts and the law merits, the Inland Revenue Department will not shy away from sharing potential criminal cases of tax fraud with the Office of the Director of Public Prosecutions (DPP).