UPP to host townhall on ABST increase

The UPP has organized a townhall meeting on Thursday to discuss the government’s announcement of a 2 percent increase in the Antigua Barbuda Sales Tax (ABST) to be implemented in the new year.

The opposition party disagrees with the policy announcement, which is expected to be officially announced by the Prime Minister during the 2024 Budget presentation next week.

The townhall will take place at the Glanvilles Community Center at 7:30 pm, after Governor General Sir Rodney Williams delivers the Throne Speech earlier in the day.

The UPP plans to hold various townhalls in different communities to engage with their supporters and the public about what they believe is an unnecessary and burdensome tax increase from 15 percent ABST to 17 percent. However, on state media Monday night, Financial Secretary Rasona Davis-Crump stated that the government has been operating at a loss for some time and needed to take certain fiscal measures to boost revenues.

She said, “We are running primary deficits, so we don’t have sufficient funds to cover our operations and our interest payments.” She added, “The ECCB [Eastern Caribbean Central Bank] has set a monetary target of 25 percent of GDP as what we would ideally want to be at for tax to GDP to be able to fund the activities of government and be able to supply to the population what the government is responsible for.” Davis-Crump mentioned that the government is 10 percent away from that target goal. Meanwhile, Deputy Commissioner of the Inland Revenue Department Jermaine Jarvis said that the government is expected to surpass tax revenue collection for 2023 compared to the 2022 figures of $752 million.

He said, “We are on track to exceed the performance of 2022 in terms of tax revenue collection…we still have a fair way to go [to reach $800 million], but we do see some improvements.” Just over $300 million of the more than $700 million collected last year was from ABST.

The Financial Secretary also stated that for contractors and suppliers within the country to whom the government was in arrears, “it was not that an issue that we do not want to pay, but the revenue disparity has made it more difficult. So, there is a menu of options available, and as technicians, we would have looked at the numbers – persistent deficits, unable to fund the expenditure, even the minimum expenditure that we have we are undertaking now – and we made some recommendations to Cabinet.

That includes addressing some expenditure, but mainly our main problem is on the revenue side, a number of measures that need to be considered,” Davis-Crump stated. The technicians said that there needed to be a broadening of the tax base, which they made clear will not involve the items that have been zero-rated such as chicken, fish, butter, fresh fruits and vegetables, rice, and flour.

Zero-rated items are supplies that are subject to ABST but at the rate of zero percent.