For anyone who thought historic UK tax collection driving a recession was a recent revelation, there’s more: Government spending in Anguilla is also at an all-time high!
You would think it’s obvious. In the last generation, the cost of running our government increased 4x for the same population and services.[1] It now consumes about half our economy, considering all “taxes and other revenues received by the national government.” [2] But it happened slowly enough to miss the obvious.
Missing Houses, Education, Businesses and Dreams
Instead of seeing the obvious as it happened, we just as slowly gave up our dreams of new houses, going to college, or starting businesses or families, even traveling to relax or see loved ones. And lately, “saving up” to go out to eat, and putting things back at the register. We could no longer afford life as we knew it while more and more was taken from us just to run government.
In fact, they spent us into 7th place among 222 countries for the greatest government burden according to the CIA World Factbook. When the stabilization levy, excise taxes, tariffs – and social contributions like “social security… grants, and net revenues from public enterprises” were included, nearly half (46.7%) of our productivity was consumed mostly by government salaries and departmental expenses, not building buildings, piers, runways, or roads.[2]
Oh, and about the UK recession and local councils bordering on bankruptcy? In 2020, the UK ranked #52 on the same list – before historic tax highs. And Anguilla was #7 – before GST. [1,2]
Inattentional Blindness Example: What You Just Read.
If you are reading this while streaming or listening to radio, you would be perfectly normal if you missed that we pay more for our government than 215 of 222 other countries’ citizens pay for theirs – about 50 cents of every dollar.[2] Before GST.
In fact, we experience “inattentional blindness” whenever we “miss the occurrence of an unexpected yet salient event if …engaged in a different task.” For one comparison, a recent “inattentional blindness” study was conducted with radiologists given a series of patient scans to identify cancerous or pre-cancerous tissues. However, 83% of them missed the otherwise obvious, experimental addition of a gorilla image that was “48 times the size of the average [cancer] nodule” in one of the cases they were asked to review. And they were experts trained to see every millimeter of a scan. [3]
Considering how many people have focused their attention on second or third jobs to pay massive increases in our tax burden, “inattentional blindness” to the government slowly gutting generational wealth is, well, easier to see.
Missing the Obvious from Change Blindness
The fact that government spending has slowly changed may also contribute to why most have missed the otherwise obvious loss of half what they spend hidden in the cost of all we buy, eat and do. This condition is known as “change blindness” and typically describes missed visual cues when changes are not perceived. Contributing factors include “flickering” and our capacity to perceive only selective elements of a given scene or situation.[4]
Before GST began reminding us of government demands with every purchase, most increases “flickered” with intermittent visits to IRD or bills in the mail. That is, we have suffered “change blindness” to shifts that might only be obvious if observed for the same transactions side by side. Notably, many are imposed annually, such as driver’s licenses, car registration fees, business licenses, property tax, work permits, extensions of stay and company registration fees. How many of us stop to compare such changes from year to year, much less retain comparable receipts?
Still other obvious increases could be missed with “inattentional blindness” more frequently. These include monthly bills with mounting communications tax and environmental levies and surcharges, steeper duties, excise, and customs fees after spending hours to clear goods, higher health authority fees when rarely unwell, or departure tax for occasional travelers. Even surging offshore shopping duties and fees could be overlooked for goods that are not purchased routinely.
And for most, changes could be easily blinded in bank deposit levies – and passport renewals every ten years. Likewise, any combination of climbing, unseen taxes could be passed along by a landlord in a family’s rent or any business in merchandise and groceries, fuel, dining, and all other services, plus GST.
In essence, a slow, insidious increase “flickered” over the years for the same services, near-zero inflation until 2022 – and the same population, none of whom are expert radiologists in a major medical center focused on changes! No. We are all susceptible to “change blindness” now compounded by “inattentional blindness” when it comes to missing otherwise obvious increases.
Missing Obvious Questions
In fact, for those who missed it, Anguilla once led the region with 14% real growth [5] when an efficient, effective set of ministries provided quality education and civil, health, and community safety services. But then our government burden grew to 7th highest in the world – before GST.
So. Whether blind to our relative excesses – or to gradual changes, we have missed at least one obvious question: As in the UK, when will new highs of government demands push Anguilla into recession, extinguish incentives needed to generate the very revenues required to pay any taxes, and drive businesses offshore – or into bankruptcy? Indeed, when is enough, enough?
Ironically, GST has pulled the blinders off for all to see a generation of fiscal dereliction. While it may be what many see as just the hair on the beast, GST has our attention and forces us to see what is changing, as that tax gorilla grows more obese with every purchase every day. And, when will they ask how to spend less instead of more to deliver the exceptional quality we once enjoyed for a quarter of the cost?
Most of us would like to see people building their houses, graduating with honours, starting their families and globally competitive businesses, saving for rainy days, and continually celebrating success with our celebrated cuisine and their loved ones, not just now and then. You know, where the obvious changes we can’t miss are Anguillians’ dreams of prosperity coming true.
Repeal GST – and pass a balanced budget bill. Now.
This article reflects cultural and economic issues raised on July 5, 2021, at the House Select Committee on GST Public Hearing. [1] GoA Budgets, 2000-2024; [2] https://www.cia.gov/the-world-factbook/field/taxes-and-other-revenues/country-comparison/; [3] Drew, T., Võ, M. L.-H., & Wolfe, J. M. (2013). The Invisible Gorilla Strikes Again: Sustained Inattentional Blindness in Expert Observers. Psychological Science, 24(9), 1848-1853. https://doi.org/10.1177/0956797613479386; [4] https://en.wikipedia.org/wiki/Change_blindness; [5] https://www.cepal.org/en/publications/38825-economic-survey-caribbean-2004-2005.
