St. Maarten Government and Chamber discuss new tax system

POSTED: 08/19/11 12:11 PM

St. Maarten – Finance Minister Hiro Shigemoto says Thursday’s meeting between the Council of Ministers and the St. Maarten Chamber of Commerce and Industry was “a very good discussion” where the stated a willingness to work with government in a number of areas including improving customer service. Crime situation was also a central discussion point, with the Chamber calling for a national crime committee. This matter will be discussed further in a separate meeting with Justice Minister Roland Duncan, as he was not present at the meeting.
Revamping of the tax system and the involvement of the Chamber of Commerce in this process was also discussed at length. Shigemoto provided an update on the process that is focused on creating a system where everyone pays their fair share and that is beneficial to the entire country.
The Tax Reform Committee has already met with various stakeholders and sought their input. Some of those groups have provided information and others have yet to submit their thoughts. The already collected information is being compiled and the committee is preparing for the review phase.
“Once all have had the time and opportunity to assess their area of the tax review, and have come up with the proposed changes, these will be put together in a plan of approach especially outlining the implementation per phase of the national tax system for country St. Maarten. It is not so that the new national tax system will be changed abruptly on a particular date. The process to come to a new national tax system is a dynamic process which involves many disciplines (stakeholders internal and external) and requires a phased approach for implementation,” Shigemoto stated in a release about the meeting.
“More importantly the Tax Reform Committee has informed me that whatever mix of taxes is chosen, this will be done gradually, already starting with phasing out existing taxes through adaptations leading to eventual dissolution of that particular tax or shifts in the legislation to improve upon an existing tax taking many factors (such as, but not limited to, the economy, socio-economic situation, government’s income needs, investment climate, regional competitiveness, existing tax treaties, world financial and economic situation, etc) into consideration,” Shigemoto added.
The finance minister has pledged that he will provide updates on the system to the Council of Ministers, Parliament, Chamber of Commerce and the general public as he receives them from the committee. He said he also informed the Chamber that a shift and/or change in fiscal legislation has to go through a lengthy process of advice from the various State High Councils and other entities such as Fiscal Affairs, Legal Affairs, Council of Ministers, Stakeholders, Council of Advice, and the Socio-Economic Council.

Tax Compliance
The Tax Reform Committee is also addressing the compliance issue by setting up a compliance team which will commence with its work by the beginning of 2012. Preparatory work for the compliance team will commence in the last quarter of 2011. It will work on ensuring that as many tax payers possible are paying their fair share into both the current and future tax system.
The Minister of Finance also informed the Chamber of Commerce that changes to the existing turnover tax will also be looked into as this tax is not free of flaws and in its present state is not the most beneficial tax for the national economy.
Other topics discussed in the meeting with the Chamber of Commerce included the National Health Insurance system, the hospital, education, the national economy, and cooperation between the North and South sides of the island. The Chamber of Commerce has also pressed for a Tri-partite committee to tackle problems which transcend our borders.

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