While businesses have welcomed the payment of outstanding (Value Added Tax) VAT refunds and a positive economic projection as announced by Finance Minister Colm Imbert during his mid-year budget review on Monday, they believe, however, that more must be done to enable a more conducive business environment which the minister could have included.
The Business Guardian reached to several entities including the Chaguanas Chamber which advised there are several variables needed to be improved to enhance private sector activities, according to its president Richie Sookhai.
For instance, he said, bureaucracy at integral public agencies must be minimised as this continues to stymie business processes.
According to Sookhai, importers are «always at the mercy of Customs’ red-tape practices» which hinder the timely clearance of imported goods for resale or even raw materials and machinery.
«If they (Customs) are not satisfied with the document compliance which were already presented to clear the same goods successfully, the importer would now have additional burdens of compiling other unnecessary information which takes time and results in delays as this prevents the importer from accessing his goods.
«This in turn delays his business operations and also drives up his costs of doing business further,» Sookhai explained.
Additionally, he said there’s too much bureaucracy when it comes to accessing licences and permits.
For example, Sookhai cited that although the process for applying for a building permit has transitioned to an online platform, there are still many hindrances regarding the signing-off of approvals due to a lack of sufficiently qualified personnel at State agencies.
Further, Sookhai said these obstacles also present problems to foreign entities operating locally which, he added, have also been deterring them from wanting to expand and even new entities which may have been interested in investing in the local economy may now become hesitant to do so.
The Business Guardian also reached out to President of the T&T Chamber Ian De Souza on what else Imbert could have included in his review to further assist businesses.
De Souza said he preferred to stick within the confines of a press release issued earlier by the chamber which noted that it has been advocating for VAT refunds to be made current for several years, adding that it is pleased that $1.6 billion of the additional expenditure will go to an increase in payment of refunds for April to September 2022.
Saying it has also noted the minister’s intention to settle outstanding payments to suppliers and contractors, as well as the payment of arrears to utility companies, and outstanding gratuities to public sector contract workers, the chamber added that these payments are expected to result in a much-needed stimulus to the economy.
But former chamber president Gabriel Faria said, «I think there was a statement about $4 billion still owed after the $1.76 billion. If that’s so it means refunds climbed to $6.76 billion which is higher than the amount owed two years ago.
«What is the plan to address the balance owed and solve this ongoing issue?
«This highlights that the Government did not honour its obligation made in the 2020 budget to keep refunds current.»
Other measures which could have been implemented
According to the T&T Manufacturers’ Association (TTMA) the Minister of Finance, during his presentation, could have given an update of certain items that were intended to be part of the stimulus package of the national budget in October, 2021.
It identified these as the Exim Bank Catalytic Fund, reduced tax rates by five per cent for existing exporters and 50 per cent exemption on chargeable income for new producers involved in exports and the proposed research and development allowance of 40 per cent for the business community.
Imbert, during his review, had also noted that for October 1, 2021, to March 1, 2022, an overall deficit of $4.754 billion was projected but instead, Government recorded a surplus.
«And that was based on the preliminary data available to the Government back in September 2021. However, I am pleased to report that instead of a deficit of $4.754 billion at the end of March as was expected, based on revenues received and expenditure incurred, the Government has actually recorded a surplus of $654 million,» the finance minister also noted.
He also said that some $5.408 billion higher than the projected income in the first six months of the fiscal year.
Imbert attributed that surplus to the higher than expected receipts of taxes on incomes and profits stood at $3.2 billion, adding that because of the positive cash flow based on increased energy prices, this was more good news.
Asked about how confident the TTMA was regarding Imbert’s positive outlook growth, the TTMA said this along with the CSO’s figures for the first three quarters of 2021 indicated that efforts have been fruitful.
«TTMA will continue to pursue avenues within its power to stay on this trajectory for the manufacturing sector via trade missions, the export booster initiative and our annual trade and investment convention, to name a few.
«The TTMA also looks forward to working closely with the Government to improve the ease of doing business in Trinidad and Tobago. We believe this is a vital cog in stimulating economic activity in the country,» the organisation added.
However, the TTMA emphasised that integral for the sustenance of local business activity must be addressing the crime situation; tackling trade facilitation challenges such as port inefficiencies, properly resourcing border agencies such as Customs; assisting in building labour productivity and ensuring that the right legislative frameworks are enforced.
It also maintained that providing mechanisms to protect local manufacturing against illicit trade would go a long way in creating an enabling environment for the sustainable growth and development of business operations.
The TTMA also shared some insights as to what extent has there been an expansion in the demand for goods and services from its members during the last year or so.
It cited that in 2021, there was an increase demand for food and beverage, textiles, including PPE, chemical based products such as hand sanitiser and cleaning products and construction.
And, according to the TTMA trade missions have also produced an increase in demand for the goods to fulfil new export orders.
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LINK ORIGINAL: The Trinidad Guardian