St. Maarten Government upgrading tax administration as work on new system continues

POSTED: 09/14/11 11:34 AM

Turnover Tax to be evaluated

GREAT BAY, St. Maarten – The Finance Ministry now expects to complete its planned overhaul of the tax system “within 18 months.” The announcement of the new timeframe was made by Governor drs Eugene Holiday during Tuesday’s opening of the 2011 – 2012 Parliamentary year.
“Non-disputable elements of this overhaul are: simplification, fairness, efficiency, stability and feasibility. Our tax system needs to have those elements built-in that provides a low threshold, both in terms of the complexity as well as in competiveness; Thus improving the tax payers’ attitude towards taxes in general,” the governor said.
The United People’s (UP) Party/Democratic Party (DP) coalition had committed to finishing the new tax system by January 1, 2012 in the draft governing program it sent to the governor as part of the formation process. In his budget statement in June the Finance Minister announced the date had been shifted to the end of 2012. The 18 months projection takes us to the start of the second quarter of 2012.
A review of the turnover tax (TOT) is being “seriously considered” as part of the revamp of the tax system. The Finance Ministry believes the tax is good for government’s coffers, but they want a fuller assessment of the taxes effect on the economy.
While a new system is far off, the government has decided to make upgrading the tax administration an ongoing project. The first deliverable, which they hope to achieve in the coming parliamentary year, is having all tax payers in the system. Efforts to accomplish this goal are already underway through a project called “Improvement Data Management by Government Agencies”. Under that project databases of agencies like the Chamber of Commerce and the Civil Registry will be synchronized with or at least accessible to the Tax Office.
“It is the intention of government to extend this data management process to other government departments as well. This alone will considerably improve government’s income and will provide better insight for the bases of tax reforms,” Governor Holiday said.

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