2 weeks Ago
Colm Imbert is a very happy Finance Minister. On Monday, the Privy Council gave the legal go-ahead for the Trinidad and Tobago Revenue Authority (TTRA) to start operating. “WE WON THE CASE!” Mr Imbert posted in all-caps on the social media platform X (formerly Twitter).
Whether citizens will come to share in Minister Imbert’s ecstasy depends on whether he fulfils the several promises he made during the court case. In June this year, as part of the legal proceedings, the Finance Minister submitted an affidavit that set out several arguments supporting the urgent need for the TTRA. As regards the Authority itself, Mr Imbert stated the Government was of the “firm view” that the many defects of the Inland Revenue Division (IRD) and the Customs and Excise Division (CED) could be solved by “a semi-autonomous revenue authority”.
Now that the TTRA is set to begin operations, citizens will expect many of the problems they encounter at the IRD and CED to be minimised, if not eliminated entirely. In his affidavit, the Finance Minister asserted that staffing would be improved, as would tax administration through improved technology and data analytics. He also promised “an improvement in the ease of doing business in this country through the reduction of bureaucracy”.
If none of this starts to happen within a reasonable timeframe—say, one year from now—we expect stakeholders such as the Public Services Association (PSA), which was vehemently opposed to the TTRA, as well as the various chambers of commerce, to inform citizens if they see no improvement in the business climate. Minister Imbert’s affidavit also predicted an annual increase in tax revenues estimated between $3 billion and $10 billion and an improvement in T&T’s international credit rating. This is supposed to happen in the second year of the Authority’s operation, according to the Finance Minister, and by the third year will be equivalent to 3% of GDP.
Given that taxpayers will then be put under additional financial pressure, citizens and companies will no doubt be more vigilant about ensuring the Government is using their money wisely. This is especially so since Mr Imbert made it clear that the main purpose of the TTRA is to collect more revenue for the Government to spend. His affidavit states that the Government wants to “maintain and perhaps increase expenditure”.
The additional taxes are to be used for subsidies, grants, free services, social programmes, and infrastructure. Whether this is the best way to ensure economic stability and growth is a separate debate. However, it is noteworthy that the drop in energy revenues has forced the administration headed by Prime Minister Dr Keith Rowley to exercise atypical fiscal discipline.
Even so, the Government’s funds are too often allocated to achieve political ends. Will such skewed expenditure, determined by vote-catching rather than needs, worsen next year when the general election is due? With the lofty expectations Minister Imbert has raised for the TTRA, the Authority’s initial operations will be a valid measure of the competence of the Rowley regime..
