Members of Parliament will debate tax reform this afternoon (see related story). Few will argue that the existing system is most likely outdated and modernising it to keep up with today’s developments is in principle a good thing.
However, it is also a very sensitive issue, where the smallest misjudgement can have severe financial, social and economic implications. The fiscal climate of any country is also key to investment both locally and from abroad.
Another potential problem is that tinkering with the tax system could lead to unrest in the marketplace if not done in a correct, transparent and unambiguous manner, so possible doubts are not allowed to linger. Relevant experience and knowledge gained by other Dutch Caribbean territories may certainly be helpful in that regard.
Nevertheless, after the upheaval Hurricanes Irma and Maria caused in the community, one is left to wonder whether this is really the most opportune time to revamp the country’s taxes. After all, the private sector is still in recovery mode and in many cases struggling to survive.
Moreover, fiscal non-compliance is said to be rather high, with double-digit figures of up to 30 per cent mentioned. At one point less than half the companies registered at the Chamber of Commerce reportedly even had a CRIB number to be able to pay taxes.
Mind you, steps to improve this situation have been taken since, but the impression exists that too many keep getting away without paying their fair share, which contributes to creating an unlevel playing field within the business community. That’s consequently where the focus should be at least for now, not just because it’s probably safer especially under the current circumstances, but first and foremost as it’s simply the right thing to do.
