Prime Minister Gaston Browne has said that his government will manage concessions strictly this year, to eliminate any possibility of wastage, curb revenue leakages, and ensure value is received for every dollar of public funds spent.
Browne, while presenting the national budget on Thursday, said the intention is to reset the way public finances are managed.
“Concessions are granted to help businesses – especially during the startup phase, to incentivize certain activities that are beneficial to the economy, and to provide relief to individuals in need. But, for the government to provide the goods and services, which all in our society rightfully expects, concessions will have to be strictly managed in 2023,” Browne said.
Meanwhile, Browne said over the next twelve months, we will pursue a series of revenue and expenditure reforms that will enhance our ability to deliver both timely and efficient service to the public, and to finance projects and programmes to advance the social and economic well-being, of all.
Antigua and Barbuda Investment Authority will be authorized to monitor and report on projects for which concessions and tax exemptions are granted, he said.
“Non-statutory tax exemptions will be suspended across the board. Where a strong case can be made for an exemption, only 50 per cent of the import duty will be provided.
The ABST, Revenue Recovery Charge, and Environmental Levy must be paid in all instances. This is a necessary intervention to maintain expected tax revenues. Currently, nearly half of the revenue assessed for collection by the Customs and Excise Division is exempted,” according to Browne who is also the country’s finance minister.
Set-offs with companies that provide services to the government will be judiciously employed and PM Browne says the objective will be to allow the government to reduce its obligations to suppliers and contractors while, at the same time, allowing these businesses to reduce their tax liability.
“The system for exchanges at Customs will be discontinued apart from exceptional cases,” he added.
The way government contracts are issued and managed will also be overhauled, particularly those administered through National Solid Waste, Central Board of Health, and Public Works, according to the prime minister.
This, according to him, is to ensure a more equitable distribution of contracts and that government receives better value for money.
“This will also allow for better allocation of resources thereby ensuring consistency, timeliness of payments, and most importantly, that the public enjoys improved delivery of services,” he disclosed.
Meanwhile, the property tax rate will be increased from 0.3% to 0.5% on residential properties valued at $3 million and more.
“The revenue generated from this measure will be used to help finance the government’s urban renewal and national beautification initiative, which includes creation and maintenance of “green spaces” in St. John’s and across the island,” he said.
In addition, Browne said the ABST tax base will be broadened, and its administration strengthened, while legislative adjustments will also be made to close loopholes that enable tax avoidance. Currently, more than one-third of ABST revenue is given away through tax exemptions alone.
“Again, we must rationalize the use of concessions and collect revenues so that quality social programs can be provided to the needy and critical public infrastructure can be funded for the benefit of the entire nation. Mr. Speaker, while there has been robust economic growth, there has not been a commensurate uplift in tax revenues,” he said.