| “Clapping should not mean that you want a new tax,” Mr. Ved Gandhi told his applauding listeners following his recent presentation in which he stressed the need for the introduction of a Goods and Services Tax (GST) or VAT (Value Added Tax). It was both a candid and pertinent remark. |
| The IMF fiscal expert was obviously aware that the applause, after his terse views to do away with the old tax structure, including Import Duty and Surcharges, was reminiscent of the wrong type of clapping he received some months ago. That was when he, along with his colleague, John Wiggins, announced their support for the 2011 budget, but spoke about a number of new taxes on which it was hinged and which later led to much grumbling and uneasiness on the island. So elated were some persons when the two consultants upheld the budget, that they strangely clapped when they should in fact have been “wringing their hands and gnashing their teeth” over the taxes. The clapping this time may have however been misunderstood by Mr. Gandhi. It was probably more a matter of protocol and good manners for any passionate speaker after an exhaustive lecture, and not necessarily a commendation for the subject matter. The truth is that Anguillians and, for that matter, people everywhere, do not really like to hear about taxation especially in these difficult times although, admittedly, taxes and revenue collection are a must to finance the public services and the day to day running of a country. Like the environment, things are changing pretty quickly in Anguilla. An island where some species of life were completely absent is now overridden by frogs, and Giant African Snails, to name two of the pests. And now an island where taxation was once minimal is suddenly overburdened by taxes with such new ones as GST or VAT, only heard about in foreign lands originally, now on our doorsteps. There was a certain degree of apprehension and concern at the meeting and Mr. Gandhi was well aware of it. Unfortunately, some persons were of the view that it was the British Government at work through him in imposing new taxes, not realising that in fact it was the Anguilla Government which brought in Mr. Gandhi to advise its Tax Reform Working Group on a new tax structure to bolster future revenue levels in the budget. Mr. Gandhi was right in his approach in pointing out the need for Government to raise additional revenue to finance the varied public services of the island and ways and means of doing so. Where he appeared to have erred was in the manner of his terse and take-it or leave-it discourse. One of the speakers was bold enough to say to him: “I listened to you and respected you, now you listen to me and give me the same respect”. Of course, Mr. Gandhi really did not disrespect any one. It was purely the passion with which he spoke or perhaps shouted during his delivery that came over the rough shod way it did. It may be necessary to mention here that at Mr. Gandhi’s first meeting in Anguilla, on the budget, a representative of the Chamber of Commerce took offence over a response he was given after putting forward an idea to Mr. Gandhi. There were several questions and comments at this tax reform meeting which suggested that a number of persons were uncomfortable about taxation. What may have been needed was a recognition, by Mr. Gandhi, of the sensitivity of the issue and a more careful and gentler approach especially in replying to the questions. The truth is, however, that Anguillians have to become a bit more accustomed to taxation, but unreasonable taxes are another matter. There may be a need for much discussion on, and preparation for, the suggested Goods and Service Tax or Value Added Tax. Mr. Gandhi himself admitted that fact. It is certainly always easy to talk about a matter. Actually getting it done is another thing. Mr. Gandhi is convinced that the GST is the way forward for the tax system in place of Customs Import Duty, the current “anchor” of the tax system to which so many in Anguilla have become familiar and the Government so reliant. The questions to answer are:Will the GST“anchor” hold firmly and securely in a new tax structure, or do we need to look for another in these economic storms of life, or should we just brush up and strengthen the “anchor” we have at present? |
