Marlin eyes cell phones, lottery ticket and rental cars DP launches alternatives for generating tax revenue

POSTED: 04/9/13 11:45 AM

St. Maarten – Waive the transfer tax on homes in the price category between $140,000 and $210,000 for first time buyers. MP Leroy de Weever announced yesterday during the first round of the central committee debate about the draft 2013 budget that he will table a motion to that extent in parliament. The waiver should be valid for at least the next two years, the Democratic Party-MP said.

De Weever also wondered about the proposed increase of the transfer tax from 4 to 5 percent. In the draft budget, the government notes that real estate transactions – and therefore transfer tax revenue – were slightly down in 2012 and that it wants to repair this by imposing a higher tax. “The government expects to add revenue with a shift from 4 to 5 percent in a reclining economy,” De Weever said. “The world economy is still in a downturn. This has a direct effect on our economy. Looking at the anticipated increase in revenue, the government assumes that if it raises taxes, revenue will increase proportionally. I disagree with that.”

De Weever noted that there has been a constant decline in the real estate business.”In the Netherlands the reaction was to lower the transfer tax by 2 percent,” he said.

De Weever wondered furthermore if it is “politically wise” to increase the personnel costs for the parliament by 4.95 percent. The 2.3 percent cost of living adjustment should also have consequences for pensions,” the MP pointed out.

De Weever warned that the proposed increase in fuel prices would have a negative effect on consumers. “The additional income projected from this measure is almost 3 million guilders. That will lead to higher cost for water and electricity. I intend to show alternative ways for increasing government revenue without burdening the population.”

The projected 1 million guilders the government expects to collect from outstanding student loans is another question mark for MP De Weever. “How does the government expect to collect this? Is this realistic given the minuscule collections of previous years?”

De Weever also questioned the 26 million in additional revenue the government expects to collect in taxes on alcohol and tobacco. “How did you get to these numbers?” he wondered. “It is about half a billion in sales.”

The MP said that the US government is subsidizing rum-producing countries in the US

Islands in the Caribbean. He also noted that the government ought to look at the maximum amount tourists are allowed to take home from St. Maarten. “From the US Virgin Islands they are allowed to take home $1,600 worth of souvenirs and six bottles of alcohol. From St. Maarten they’re only allowed to take one or two bottles.”

De Weever also foresees a dramatic effect of the tax-hike on the local economy. “Let us not fool ourselves,” he said. “Between Front Street, Back Street and Simpson Bay there are currently 52 empty stores.”

De Weever’s fellow-faction member Roy Marlin also stuck to remarks about the budget. “I have a problem with the fact that taxes that are on the books are not collected. But in the meantime we are going to collect new taxes,” he said.

Marlin fears that it will take quite some time before the ordinances that regulate the new taxes have run their course through parliament. “We’ll be in August of September before we get there,” he warned. “So that means implementation in 2014 if we don’t watch out. We should not hang our hat where we cannot reach. I do not think that this budget will offer the solace we are looking for.”

Marlin questioned a decision by the bureau telecommunication and post to buy a building for 6.5 million guilders. “This is a ZBO (an independent administration organization – ed.) that manages funds for the government. And now it is committing our income to buy a building –and we did not have a say in it. That is impossible. I want to know whose decision that was.”

Marlin suggested bringing the law for levying fees on residence permits to the parliament – good for 8 million guilders in revenue. “If that is ready we are able to lower taxes,” he said, adding for good measure: “That is not Minister Duncan’s money, but the money of the government. That will decide how to distribute it.”

The Bureau for Intellectual Property is a possible source of new revenue, MP Marlin said, before launching a severe attack on the Department of Economic Affairs. “This department has failed miserably when it comes to collect revenue that is now on the books,” he said. “This is now handled by Curacao on our behalf. Why cannot we set up this bureau?”

Marlin furthermore suggested a stamp tax on lottery tickets. “These companies pay now 10,000 to 50,000 guilders a month. That is a joke compared to the money they are making.”

Marlin also took aim at car rental companies that have many of their cars on French number plates. “We have to change the law so that when you obtain a license for a car rental you also have to buy the plates for the number of cars you have,” he said.

The MP once again took aim at the Department of Economic Affairs, repeating that it is failing miserably. “I needed a new business license one year ago. Every time I go to the department I get to hear: it is not ready yet. I need a business license, a liquor license and a change of address. And after one year, they are not ready yet. I wonder how many business licenses are pending.”

The change in the road tax system, whereby car-owners no longer have to change their number plates was according to Marlin a bad idea. “We won’t collect what we are supposed to collect in road tax. It is going to be much less than last year.”

Cell phones are also in Marlin’s cross hairs. “There are more than 30,000 cell phones on the island. Let’s levy a small fee on top ups,” he said.

Marlin was not ready yet with suggestion for generating state revenue: “we are not charging for the use of the sewage plant,” he remarked, suggesting that a fee of 32 guilders per month ought to be feasible.

 

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