The Government of Anguilla, through the House of Assembly, intends to give the Goods and Services (GST) Bill its second and third readings on Tuesday, July 27, thereby ensuring its passage.
It is understood that the Opposition Members will not be supporting the Bill.
The GST Tax is expected to come into operation on July 1, 2022. The tax will be at a rate of 13 percent, with a threshold of EC$300,000 payable by registered businesses making that annual income.
A comprehensive analysis of the provisions of the tax has been delivered by the Acting Comptroller of Inland Revenue, Mr. Lonnie Hobson. He was at the time participating in the Government’s press conference on Monday, July 26.
The delivery was highly technical in some instances. The Government’s Public Relations Officer, Mr. Ivan Connor, has indicated that a more “palatable”, or easily understood version, will be available to the public later on.
Among the excerpts taken by The Anguillian newspaper from Mr. Hobson’s presentation are the following:
Exemptions from GST
ZERO RATE: Basic foods (e.g. rice, bread, flour); commercial farming and fishing products; manufacturing products; exports of goods and services; domestic electricity (up to 130kWh per month; and sanitary products and contraceptives.
EXEMPT: Healthcare (services and devices); prescription drugs; education services and textbooks; insurance (life, health, international); financial services; water consumption; sale of land; property sale of second-hand homes; property let of 183 days and more; nursing home/residential care services; religious services; personal effects of returning nationals.
SOCIAL IMPACTS – HEALTH: No GST charged on medical services; No GST charged on life and health insurance; No GST recovered on related costs.
EDUCATION: No GST charged on services and materials such as textbooks; No GST recovered on related costs.
ELECTRICITY (ANGLEC): Commercial customers – GST charged; domestic customers –no GST charged on first 130kWh per month; (GST charged above 130kWh). GST recovered on related costs.
WATER: No GST charged on commercial or domestic metered supplies. No GST recovered on related costs.
FINANCIAL: No GST charged on most services. No GST recovered on related costs.
PRICE IN SHOPS: Should increase no more than difference between existing tax and GST. Maybe less than difference as GST paid out by supplier is recovered.
IMPACT IN BUSINESS GST REGISTERED:
As a buyer, you pay GST (at import or to supplier) and claim it back from Government.
As a seller, you charge GST to customer and pay it to Government.
IMPACT IN BUSINESS (NOT GST REGISTERED):
As a buyer, you pay GST (at import or to supplier) but do not claim it back.
As a seller, you do not charge GST to customers.
IMPACT CONSUMER:
Buy from GST registered seller: you pay GST to the seller and they pay it to Government.
Buy from non-GST registered seller: you do not pay GST to the seller.
ADVICE TO TAXPAYERS:
• Start keeping a record of your turnover (daily sales/invoice sales)
• If turnover reaches or is expected to reach $300,000 (or you trade in a sector that must register) you must register.
• Contact IRA if unsure.
(Better to get it right from the start than to have to correct and backdate).
Note from The Anguillian newspaper: Readers seeking further information on the GST provisions should contact the Department of Inland Revenue.
