The Government of Antigua and Barbuda is offering shoppers a three-day relief, this weekend, from paying the full Antigua and Barbuda Sales Tax (ABST).
The concession which began in 2012 under the United Progressive Party administration, was usually offered for two consecutive weekends.
However, according a press release from the Inland Revenue Department, the Cabinet, after meeting on December 4th, “agreed to reduce the Antigua and Barbuda Sales Tax rate, from 15% to 5%, starting from Friday December 13th to midnight Sunday December 15th, 2019. Thereafter, on Monday December 16th 2019, the tax rates shall revert to the normal legislated rate of 15%.”
Nevertheless, Minister of State in the Ministry of Finance and Corporate Governance, Lennox Weston, speaking on the reduction, clarified that the decision was made primarily with the citizens (both consumers and business owners) in mind.
“Essentially, this is not a money-making endeavour by the government. This is an attempt by the government to say, for the entire year we give wealthy investors concessions; we give them hundreds of millions of dollars on concessions and the people of Antigua and Barbuda voted for this government, they have a stake in this government and so they too require a little bit of benefit as we have given to the rich investors.
“So, it’s just small token of giving back to our consumers and also many businesses, small and large, look forward to this period of enhanced purchasing so they can turn a profit for the year. So, we wanna keep our private sector happy. We appreciate the role that the private sector has played. They provide very valuable service and we want them also to go home happy that they can pay their overdraft, they can pay their workers and they can see a little profit for their efforts,” Weston said.
But as per usual, he explained that not all businesses will be participating because “there are some businesses who said that their computerised system is so complicated and costly to adjust that they opt out of it”.
“I am not certain to what extent that is so, but I know we have heard the complaints by some businesses … that their IT system is such that it is difficult for them to make the adjustment for such a short period,” he continued.
Weston also added that the Government does not expect that this reduction will cause a significant change in revenue, but that the increase in sales will create a balance.
He said: “We don’t expect it to affect revenues. As you know, the Prime Minister made the point that our tax GDP is very low; it has been declining. Our revenue enforcement and collection is not very effective; it’s something we need to speed up. And so, we have been losing revenue for the entire year. We are aware of that … and we are going to make some changes in the new year.
“We believe that the increase in sales … will actually make us break even because there are some purchases and some persons are enticed to make now that they would not make if they didn’t have this discount.”