Mid-year Report 2016…Internal revenue collection sees 15.6% increase

Aug 14, 2016 News

– 5% rise in VAT collection

The Ministry of Finance’s Mid-year Report for this year has recorded that internal revenue collection has increased by $4.9 billion or 15.6 percent, reaching $36.5 billion in the first half of this year compared to the same period in 2015.
This achievement, as stated in the report, reflected 57 percent of the annual target with almost $3B being related to arrears and advance payments.
The report stated, also, that the remainder was primarily attributed to increased collections from the telecommunications, manufacturing, and construction sectors, and significant payments made by a new company from the architectural & engineering sector.
Meanwhile, company tax collections grew by $2.6 billion of which $675.2 million, relating to a significant increase by one major company in the oil industry and $921.2 million attributed to arrears collections.
Net property tax on private sector companies increased by $261.0 million, supported by measures which targeted the collection of arrears of $99.8 million. As at June 2016, a total of 292 companies made payments compared with 276 during the same period in 2015, representing a 5.8 percent increase. Similarly, a total of 925 individuals, including self employed, made payments during the first half of 2016 compared with 887 during the same period in 2015, the report indicated.
In addition, customs and trade tax collections rose to $6.5 billion in the first half – $0.6 billion more than for the same period in 2015.
“While the value of imports declined, import duties grew by $928.6 million or 17.3 percent above the first half of 2015. This was due in part to a decrease in tax exemptions and a change in the composition of imports.” The report stated.
Meanwhile, the Value Added Tax (VAT) collections totaled $17.3 billion during the first half which represents 5 percent more that the same period last year.
VAT on imports declined by $1.4 billion while VAT on domestic supplies increased by $436.4 million. The report stated that the declining VAT revenues on imports were due to a fall in imports by the wholesale and retail sector, while significant collections of VAT arrears, amounting to $124.4 million and $74.7 million from the manufacturing and services sectors, respectively, were responsible for the increases in VAT on domestic supplies.
The Government has requested assistance from the Caribbean Regional Technical Assistance Centre (CARTAC) to review the efficiency of the application of VAT for which a mission is due to arrive in the third quarter of this year, the report indicated.

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