I have to start by saying that I am by no means a financial expert but so many people can comment on the budget I thought I would put in my two cents. In the first place, the reason that this current government was having so much trouble with the budget is because the CFT demanded that 25 Million be cut from the budget. Understand that with a budget of just over 400 Million, this is a reduction of 6.25% which is no small amount.
The reason for the request from the CFT is due to past budgets being unrealistic and never balanced, yet people are actually trying to place the blame on this current government. I actually feel that this government and especially the Ministry of Finance is doing a good job with the budget all things considered. We must remember that SOAB once said that Government finances were in such a mess that they were unable to audit them. Who may I ask was in government then?
The SHTA and other had some criticism of the budget, which I think is a good thing. Posting the entire budget online for all to see was something courageous and a good example of good governance and transparency. Having said that though, I would need the SHTA to enlighten me on a few things. It is said that many of the major hotel properties on the island have tax exempt status (some for many years now) and yet with a reduction of the marketing budget for tourism, the SHTA complains. This confuses me because if I remember correctly, this tax exempt status is based on the hotels themselves using the money for promotion. Please correct me if I am wrong.
The SHTA and its members cannot have it both ways, you can't ask for tax exemptions and then expect government to foot the bill for everything. This also goes for other sectors of the economy. There was a report that indicated that we have a tax compliance of 30%, can you imagine if we bring that tax compliance up to 70 or 80%. We can lower taxes considerably and everyone can be happy. The business sector cannot expect government to rely on wage tax, which is paid by employees, to be the only thing government collects.
What the SHTA and other business entities should also concern themselves with is employee satisfaction. What I mean is, as a little boy I would see our local people in the stores on Front Street and the restaurants happy to do their jobs but they were mostly working on commission or for tips. Now the employers are actually keeping the tips and commission for sales is something of the past. It may be a god project for SHTA to advise their members to allow individuals to keep their tips and re-institute commission on sales, this may increase our level of service and in turn grow the economy. A happy worker is a good worker.
In addition, I personally favor a lowering of the wage and profit taxes, a simplification of the tax system and the implementation of a sales tax. The argument that this would hurt our economy does not hold water since several islands in the region have a sales or value added tax plus most of the countries that our visitors come from also have this. I can't see a tourist saying: " I not going to St. Maarten, because they have a sales tax'. It just won't happen. This tax should also help to increase compliance and lower tax burden on everyone.
There is some noise being made about dollarization again something that I am totally against and remain so. I have yet to hear a valid economic argument for dollarization. I hear things like, we are used to the dollar, it will increase investment, more tourist will come and we need to get away from Curacao. That last one was discussed by the SER and although they didn't back dollarization 100% they seemed to be leaning towards it. However in there review the argument was that Curacao being part of the Central Bank could harm St. Maarten economy. This may be true but we have been part of the central bank for 50 years now and to date the bank has done nothing to harm our economy.
If we as a country want to establish our own bank, let's just say so but to consider dollarization for this reason indicates to me that those supporting this option for this reason have no confidence in our ability to run a Central Bank. Lastly, the foreign exchange tax adds between 26 to 29 Million to the budget and nobody has convinced me that we can get these funds from somewhere else. That is 7.2% of the total budget. We have to be careful not to make decisions based on emotions and not fiscal sense.
So as not to disappoint calypsonian Fish De Mega Boss, let me take a few lines to answer Mr. Maurice Lake. On Friday I read your article, in fact I read it twice and it still didn't make any sense. Who are these elderly people that are complaining about the government? Did these elderly people also get the increase in the pension that was implemented by this government? I also would like to know, in the 10 to 12 years you were in this seat I now occupy, what exactly did you or the Government you support do for your elderly friends?
I am only asking you these questions because I find your last couple of articles repetitive and boring, so maybe if you answer these questions in some detail your article may be more interesting. In your articles you come with not one idea, suggestion or positive comment, yet you accuse the members of Parliament of doing the same.
I do agree with you that the level of discussion in Parliament needs to improve but this improvement has to start with your UP members. We can all expect politicians to be political but somewhere in there needs to be at the very least a question. Like you, I listened to the meetings and sometimes members of the UP would talk for an hour and ask not one question.
Your article on Monday was pretty much of the same, just more complaints. What I don't understand Mr. Lake is that you were in Government position for a long time, where were all these ideas then. You really think that St. Maarten people are fools. The majority of the mess we find ourselves in right now is because of the Government you support. Now you expect us to believe that you REALLY have our best interest at heart? I don't think so.
Your role here is to try to confuse the population into thinking that the UP could do a better job but you need to remember that you had your chance and just about a year ago, pressure from the population kicked the UP out of government. That decision was not only made by the Independent-3, it was due to pressure from the very population you are now trying to fool.
The public has to realize that when reading articles many have an agenda. I must admit that even my articles have an agenda but I do try to squeeze in an idea or suggestion here and there. It leads to better reading.
Kendall Dupersoy
