2009 Budget For St. Kitts – Nevis Is Well Received
Basseterre, St. Kitts – Nevis
December 22, 2008 (CUOPM)
The St. Kitts – Nevis Chamber of Industry and Commerce is applauding the 2009 Budget, presented nearly a week ago by Minister of Finance, Dr. the Hon. Timothy Harris.
A statement from the private-sector body said it is “the St. Kitts-Nevis Chamber of Industry and Commerce is heartened by the fact that Government’s 2009 Budget is “tax free” and does not appear to include any increases in existing taxes and levies.”
The Chamber said it considers the nature of Government’s 2009 “Tax Free” Budget “a sensible move, especially given the overwhelming evidence that some of the world’s major economies such as the United States of America, and some European countries are facing serious financial challenges which are expected to prolong well into the next 12 months. Moreover, some of the larger corporations in these developed countries are being given government bailouts in order to survive.”
The Chamber added that it is also encouraged by Government’s realisation that “our economic future rests, in large measure, on the development of our private sector which must be given as favourable an environment in which to thrive and succeed if this Country is to enjoy the spoils of development.”
It noted that a number of changes have been noted in the 2009 Budget for which the Chamber intends to seek clarification.
“Some of these include the possible introduction of unemployment insurance, “billable services” in Customs, and promised increases in (a) the cost of certain Government fees for services; and (b) pensions paid by Social Security. The level of these fee increases, and the sourcing of funds for the increased Social Security pensions and the unemployment insurance scheme are issues which the private sector body intends to raise with Government at the earliest opportunity,” said the Chamber, adding that it also intends to “seek clarification of those tax reform measures which have been proposed.”
The Chamber of Industry and Commerce noted Minister Harris’ affirmations regarding Government’s commitment to business facilitation.
“Among the promises he noted was that of rationalising and cementing the role of the recently established St. Kitts Investment Promotion Agency (SKIPA), and its Nevis equivalent, NIPA,” said Prime Minister.
The Chamber said of equal importance is the establishment of the National Entrepreneurial Development Division (NEDD) within the Ministry of Commerce and Consumer Affairs to handle local business development.
“We trust that the roles of these agencies will be clearly rationalised for the guidance of the private sector. Of equal urgency for the Chamber is the passage of requisite enabling legislation for micro, small and medium enterprises (MSMEs), especially since the organisation has presented to Government in 2004 draft legislation for this sector ““ through the assistance of the International Labour Organisation (ILO),” said the Chamber.
It said it is reliably informed that the draft Bill is now being reviewed by Cabinet and trusts that it will receive swift passage in Parliament so that entrepreneurial development in the Federation will truly be facilitated; thereby enhancing the private sector’s potential to create jobs and wealth.
The Chamber also commented on the budgetary allocation for the Ministry of National Security.
“The Chamber notes that the sum of EC$48.7 million has been allocated to the Ministry for 2009, reflecting an increase of just over EC$9 million from the previous year. The Chamber is of the view that these funds are well-needed if our Police Force is to execute its mandate to protect and serve the people of St. Kitts and Nevis with the aid of proper training, leadership, technology and equipment necessary to prevent crime and bring criminals to justice,” said the private sector body.
It added that it looks forward to canvassing its concerns on the 2009 Budget with Government within the near future in an effort to ensure that the Federation’s investment climate remains stable and favourable for business development.
The private sector organisation also trusts that Government will keep its word relative to refraining from the introduction of a Value Added Tax (VAT) only after proper fiscal analysis, and wide-scale public education and consultation.
The Chamber hopes that when this tax is actually implemented it would have replaced a number of other taxes that are currently on the books in order to prevent double taxation. It is to be noted that the effective tax rate exceeds the statutory rate of 35%, especially since companies are still taxed on their capital assets.