PHILIPSBURG:--- The One St. Maarten People Party has taken note of the statements of the Minister of Finance, the Honourable Mr. Richard Gibson to impose a 6% tax on goods purchased on line and his concerns about a 30% reduction of business reported by the business community. As a political party we are also very concerned when we hear about such a reduction in business because most of the time this also results in the loss of jobs, a very scarce commodity now in St. Maarten. And most of the time it is our people that are the first to be affected by the loss of jobs.
The OSPP has forwarded a letter to the Minister of Finance, Honorable Mr. Richard Gibson informing him that imposing any type of tax on the importation of goods that were purchased on line would not deter the public from buying those products. Firstly, even with the implementation of a 6% tax on those goods the cost of those products would still remain lower than the prices that these same goods are sold for in our stores. Secondly, the general public feels that most of the products purchased locally, especially electronics are refurbished goods.
In our letter to Minister Gibson we questioned how his ministry is planning to introduce this tax. Will it be a Turn Over Tax? If such, this tax must be part of the selling price and the seller from the country of origin of the products would have to collect it and pass it on to the government of St. Maarten? This is very unlikely. If the airport and the harbour are assigned to collect this tax then it is a Sales Tax. “Do we have this legislation in place we asked the Minister of Finance? One other way to collect this tax that the Minister of Finance is proposing would be in the form of an Import Duty. Is the government of St. Maarten willing to introduce import duties on these products only? If the answer to this question is yes, then we would like the government of St. Maarten to also consider our proposal to introduce an import duty on alcohol and tobacco. During the 2016 Budget debate we submitted various motions to the Parliament of St. Maarten including one to implement an import duty on alcohol and tobacco. Studies in the Netherlands have indicated that the increase in the cost of health care is attributed to the excessive usage of alcohol and tobacco. We believe that this may also be the case in St. Maarten however no studies have been conducted in this area as yet.
Once again we have submitted the same motions to the Minister of Finance that were submitted to the Parliament of St. Maarten during the 2016 budget debate, namely; the installation of parking meters in the Philipsburg area; a government tax for garbage collection; the setting up of the St. Maarten Sports Lottery and the implementation of some sort of import duties on alcohol and tobacco just to name a few. We also suggest to the minister to consider reducing the cost of energy to the businesses and the rates that they are charging for containers at the harbour. These savings would be passed on to the consumers. NV GEBE and the Harbour Group of Companies are owned 100% by the government of St. Maarten and by extension the people of St. Maarten. Let’s not punish our people but let’s improve on the quality of their lives by reducing the cost of living to start with.
Honorable Minister Richard Gibson
The Government Administration Building
Clem Labega Square
Philipsburg, St. Maarten
Attention: Mr. Richard Gibson
Minister of Finance
Dear Mr. Richard Gibson,
We have taken note of your statement indicating that it is your prerogative as Minister of Finance to impose a tax of six (6%) on goods imported into St. Maarten via the airport and we would imagine via the harbor also as per your discussion with the management of the Princess Juliana International Airport. You have also stated that one of your reasons is also because the business community is complaining about a reduction in business by some 30% that is partly being caused due to the importation of these goods by citizens of this country.
The OSPP supports all measures that can be taken legally by the government to increase the treasury of the government of St. Maarten. It is for that reason that as a political party not represented in the parliament of St. Maarten or the government we have submitted various proposals to the parliament of St. Maarten during the 2016 budget debate. We proposed the installation of parking meters in the Philipsburg area that would generate additional income for the government and would create more jobs as parking attendants would be needed to monitor those meters. It would also increase the convenience of parking for the people coming to Philipsburg to shop and to conduct business. We also proposed a government tax for garbage collection; the setting up of the St. Maarten Sports Lottery and the implementation of some sort of import duties on alcohol and tobacco. Studies have indicated that the increase in the cost of health care in the Netherlands is attributed to the excessive usage of tobacco and alcohol. We believe that this is also the case in St. Maarten even though no studies have been conducted as yet.
In reference to the reduction by some 30% of business by the business community we would want to conclude that this is due partially to the high prices that they are charging the consumers and the quality of their products. Many consumers also feel that in some cases, especially in the area of electronics that they are purchasing refurbished products at an alarming high price. But just imagine that a person orders a product from the U.S.A. and it cost U.S. $ 200.00 and the freight by boat is $ 25.00 and even with a six (6%) percent Turn Over Tax the cost of the product to the consumer would be $237.00. That same product in a store in St. Maarten would cost the consumer U.S. $ 400.00. As you can see your introduction of a six percent Turn Over Tax would not deter the consumer from buying on line. Secondly, how are you planning to introduce this Turn over Tax on these goods? Isn’t this tax supposed to be part of the selling price of the product? Will this tax be considered a sales tax and is this legislation already in place? Will St. Maarten be introducing an import duty only on these products that are purchased on line? Is this measure being considered in order to punish our people by forcing them to buy locally at astronomical high prices and to purchase refurbished products?
The OSPP believes that the business community must realize that the worldwide economy is not like it was many years ago. Business like government will have to try to make do with a smaller amount. And this, the business community can achieve by reducing their selling prices and indirectly their bottom line, namely their profit margin. They must also begin by selling good products and not refubished. Secondly, the government of St. Maarten that owns 100% shares of NV GEBE and the Harbour Group of Companies N.V. should reduce their rates that they are charging the business community for those services. These savings should be passed on to the general public and the consumers will prefer buying locally as opposed to buying on line for a savings of perhaps U.S. $ 20.00 to U.S. $ 30.00. This would be a win, win, win for all, the government would generate additional income; the business community would increase their profit margin comparing to now and the consumers will acquire a product at a reasonable price here on the island and hopefully a non-refurbished one.
We hope that you will consider our proposals and together we can give our economy a small boost.
We are hereby including copies of the proposals that were submitted to the Parliament of St. Maarten during the 2016 budget debate.
Yours truly,
One St. Maarten People Party
Lenny F. Priest
Leader of the OSPP
cc: The Parliament of St. Maarten
