St. Maarten Government still using 2010 budget as basis for expenses, collections

POSTED: 05/12/11 1:06 PM

Five percent turnover tax still valid

St. Maarten – The Government of St. Maarten will continue using projections in the 2010 budget until parliament approves the amended version of the 2011 budget. The budget was approved in parliament on December 23, 2010, but the Board of financial supervision (Cft) rejected it, sparking a round of negotiations that led to a new draft that is now with the Advisory Council.

“The legal basis is the 2010 budget. We use that as they call it as the basis for governance. Of course when you say you use it as the basis, you also take into account the figures you have in the 2011 budget. That’s the way it’s operational,” Prime Minister Sarah Wescot-Williams said.

The 2010 budget still reflects an Island Territory status as the urgent amendment to that budget that covers the transition to country status, still has not been approved in parliament.

The prime minister added quickly thereafter that government’s ability to collect turnover tax at five percent remains because that ordinance was also approved in Parliament on December 23.

“That particular law has been signed off,” Wescot-Williams said.

The assurance on the turnover tax ordinance and statement on the 2011 budget comes because the ordinance on the 2011 budget has not yet been signed by Governor Eugene Holiday. The Finance Minister Hiro Shigemoto was questioned about this when he met with parliament on April 21 for a debate on matters surrounding the 2011 budget. At Wednesday’s Council of Ministers press briefing the prime minister said the government had been discharging his constitutional duty by ensuring that the ordinance as submitted is in keeping with all legislation. Should the law not comply with established laws or the Governor believes it does not serve the general interest he can annul the legislation, but in the case of the budget ordinance, this has not been done.

“At the time of the Governor having to sign the approved budget you had the issue of the negotiations with the Cft, and I, and this is now my opinion, I suspect that the governor was awaiting to see what the outcome would have been because he would have been actually signing off on a budget that did not have the approval of the Cft, which is something that is laid down in a Kingdom Law. So I think those issues played a role and eventually led to us going through the process, getting the Cft’s approval on a new draft of the budget, while the old one has not been signed,” Wescot-Williams said.

The prime minister also asserted that the matter of finalizing the budget ordinance has “nothing to do” the supremacy of parliament over the Cft. For her the matter is more the governor’s role in vetting laws and then co-signing them before they become law.

“We don’t really have another budget yet either, on the basis of the Cft’s recommendations. What you’re going to have is the Cft’s recommendations taken over completely or not by the government and submission by government, to parliament, of a new budget, which budget needs to be handled, approved or not, will need to be handled by parliament as well,” the prime minister said.


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