Businesses and employees in Anguilla, already reeling from the difficult economic and financial situation, will have to bear the brunt of the Government-imposed Interim Stabilisation Levy for another year.
The unpopular levy was introduced in 2012 to boost public revenue aimed at balancing the budget. The levy is regarded as a form of income tax payable by all employers (except Government), employees and self-employed persons. The law requires employers and employees to pay a levy of 3 percent each on remunerations, and self-employed persons a rate of 6 per cent.
Chief Minister and Minister of Finance, Hubert Hughes, reacting to complaints about the levy, had promised that it would be stopped on December 31, 2012. As year-end approached, however, he indicated that there was a need to extend the levy to balance the budget in 2013. Accordingly, Mr. Hughes presented an amendment Bill in the Anguilla House of Assembly on Friday, December 28, which extended the levy for an additional year.
“The primary purpose of the Bill is to amend the Act to extend the duration of the Act until 31st December, 2013,” the Chief Minister told the House.
The Bill was opposed by Opposition Member, OthlynVanterpool. He said that while the levy had been “good for Government”, he was fearful that by the end of 2013 it might again be referred to as an “interim” measure and extended indefinitely. “The levy is still hurting the people of Anguilla, and businesses are complaining,” he advised.
Jerome Roberts, Adviser to the Chief Minister, said that the Anguilla Government ended 2012 with a significant surplus of fourteen million EC dollars from the Interim Stabilisation Levy. According to him, the revenue from the levy had surpassed Government’s expectations – and that the measure had the potential of making even more money if persons were honest in making their contributions. He called on all persons not to “short circuit the development of the island as all hands need to be on deck”.
Mr. Roberts said that the Interim Stabilisation Levy, which came into effect in April 2011, was “to stabilise Government’s finances”. He further stated: “We also indicated that the ISL would roll over in the National Health Fund 2013. However, we are not yet ready, or at that point, and therefore we have to build up. We just cannot run to a National Health Fund. Therefore, the proceeds will assist us as we forge in that direction”.
He added that income gained by Government from the levy would also assist in improving the consolidated fund and help Government refund the money owed to civil servants in salary deductions.
