Philipsburg:---Islands, countries in the region regardless of their constitutional structure have established a fiscal regime conducive to creating more economic activity and as a result generate more employment and more funds for Government’s coffers, which as a result provide these Governments with funds to invest in infrastructure, schools, hospitals, sports, the environment etc.
In fact we don’t have to look too far, our Windward Island neigbours, as part of the BES (Bonaire, Saba and St. Eustatius) structure, according to their “decision list BES Fiscal Administration Consultation on January 13th 2009” made firm decisions regarding the direction in which they wish to develop their tax regime. One of these specific directives was to look into the possibility of specifically lowering the profit tax or totally dispose of it.
In July this year State Secretary Ank Bijleveld-Schouten announced that after getting the necessary permission from the tax inspectorate, companies importing and processing goods in the BES islands, that are then exported, will not have to pay indirect taxes. The expected result is that these companies also contribute to sustainable development by creating employment and realizing infrastructural improvements.
We have been debating this issue on St. Maarten for years, lectures, debates, panel discussion have been held, but the issue loses its momentum every time, perhaps because there seemed to be no urgency. It behooves us now to pick up the discussion again and this time stick to it, certainly monitoring further development of the tax regime in the region, in particular the BES islands as we may experience an exodus of St. Maarten companies to more attractive tax environments.
No one will dispute that we have taken over a Dutch tax regime which requires much more expertise and manpower than we have ever seen invested by the Central Government. Efforts to improve our Tax inspectorate as part of the constitutional process must be applauded, but we should consider a more effective fiscal approach, which will place us in a more competitive position and allow us to ensure a higher level of compliance, promote economic activity, employment, increase revenues and overall benefits for the people living on St. Maarten and businesses alike. We must ensure that the investment being made will be sustainable.
At the end of the day we need to position St. Maarten in a tax environment that will benefit St. Maarten and its people, St. Maarten workers and St. Maarten businesses. We cannot have a tax regime that does not recognize the existence of the French side, or the competitive tax regimes that are just a few minutes away by boat or airplane. The urgency has escalated, among others, as a result of the constitutional changes and fiscal changes being made around us. We hope that the NA/Heyliger Executive Council recognizes the importance of this issue. In the mean time, other partners in our community can help get the ball rolling, after all there is much discussion about a unified approach; without giving the impression that this is not an issue for our elected officials to deal with, perhaps we can give real content to unification by addressing this tax reform issue from a broad perspective including The University of St. Maarten with an academic perspective, The Chamber of Commerce, SHTA, Labour Unions and other relevant organizations to work on this increasingly urgent issue together with government. This unified approach including all who have a contribution to make, bringing to the table a different perspective, may just be the recipe for successful dialog, and the preparation of a workable tax reform proposal, backed by the entire community.
(Maria Buncamper Molanus)