Public financial management and fiscal reform broached at 2020 Tax Summit

    Public financial management and fiscal reform broached at 2020 Tax Summit

Finance Minister Ardwell Irion (head of table) during the summit.

PHILIPSBURG--Public financial management, the tax organisation and fiscal reform were amongst the issues broached at the 2020 Tax Summit hosted by the Ministry of Finance on February 12.

In attendance were representatives of the Tax Administration, the Receiver Office, Section Business Taxes, Financial Policy Management and Control, The treasury, Information Communication Technology (ICT) Department, fiscal affairs, the Finance Department, the cabinet of the minister of finance, the World Bank and the Caribbean Regional Technical Assistance Centre (CARTAC).

Finance Minister Ardwell Irion, who opened the summit, thanked the key players in the financial arena for attending, especially those representing the World Bank and CARTAC, who traveled to St. Maarten for the forum. Irion emphasized the importance of the internal “specialists who will have to carry us further with the results of this summit.”

“We are fortunate to be able to bring together all these distinct experts in such a short time. I trust that you will contribute to, as we reflect on, the existing plans and understand the situation we are in. We aim to find a sustainable solution for the challenges that we face and I am convinced that we have the best team to give direction to reaching our objectives,” Irion said.

Addressing the three principal topics, public financial management, the tax organization and fiscal reform, the small group of experts jointly assessed the current situation and established the steps necessary to improve all three areas, which effect public finances and the customers otherwise referred to as the taxpayers.

The desired outcome is to be a modern functioning tax administration with a sound legislative foundation, operating autonomously with individual organizational planning, budget management and human resource management and to obtain sufficient skilled and qualified human resource with the aim of eventually operating a paperless organisation.

As for the tax regime, it was confirmed that since 2015 legislation was being drafted with the aim to simplify the tax system, maximize revenue and to create an attractive investment climate. Notwithstanding the numerous changes in government, which has contributed to the delay, the principles of the tax reform have remained the same, it was stated in a press release on Wednesday. Final calculations of the proposed amendments, for which reliable data is required in order to move forward, are still pending.

The relationship established with CARTAC is one of the International Monetary Fund’s (IMF’s) Regional Technical Assistance Centers (RTAC) located around the world in the Pacific, the Caribbean, Africa, the Middle East, India and Central America.

These Centers were created to assist countries to strengthen their human and institutional capacity to design and implement sound macroeconomic policies that promote growth and reduce poverty. CARTAC is already rendering results at an affordable annual cost of US $150,000, compared to millions that consultants would cost. Additionally, CARTAC’s approach of support is to assist and share the knowledge for recipient, in this case St. Maarten’s civil servants, to learn and carry out the improvements themselves. Projects such as cleaning up data and reporting are exercises that are to start within the next two months.

Short-term, medium and long-term goals, not exceeding three years, were established to begin in March of which several will run simultaneously. While many more details were discussed, assistance relating to data analysis is expected from the World Bank in the short term.

Important aspects required for success is to ensure that all who are required to contribute to the treasury do so. In light of this the tax reform will also aim at capturing the informal sector, the release said.