Kenny admits environmental levy “unlawful”

Prime Minister Dr Kenny Anthony made his second appearance on DBS’s ‘News Maker Live’ since being sworn into office. This is the PM’s third appearance on a talk show and the first since reaching his 100 days in office.
In discussing his first 100 days, Dr Anthony expressed his hopes of not having to go through a general election near Christmas in the future. He explained: “I hope we never have a general election around Christmas again; I say that with all sincerity. If a general election is announce around that time, and I am guilty because I did have one some years ago, if you succeed and you remain in government then you just continue but when you’re in opposition and you come into office it becomes more challenging.
“There is a sequence of events immediately after you’re elected; putting a Cabinet together, you have Christmas to deal with, you go into the new year and soon after you have the opening of Parliament, as soon as you’re finished with the opening of Parliament you have Independence and soon after Independence you have to begin to think about the Budget.”
Dr Anthony said 100 days is still too early to evaluate his Cabinet. He went on: “They are learning the wheels of government, the motions of government. You would be amazed they have to go through the entire Cabinet process but they are doing exceedingly well. It is too soon to evaluate them to determine whether they are being successful or not; or whether they are being partially successful or whether they are not handling certain subjects very well.
“Some of them have taken their responsibilities with undoubted passion and some also have monumental problems. You look at somebody like Alvina Reynolds; there are major challenges in health, not only the commissioning of the new hospital but the whole issue of UHC and where we go from there.”

Prime Minister Kenny Anthony says St Lucia could be hauled before the courts due to environmental levy.

The third time successful leader of the St Lucia Labour Party confirmed what many may have observed about his new approach in dealing with the opposition and the public. In comparing his first time in office back in 1997, Dr Anthony said: “I think the good thing is that I came into government this time around with a wealth of experience of the past. Also too, with a better understanding of the public and I think, even more sensitive to the public. Listening more, being very careful, being very deliberate but at the same time pursuing the agenda that we placed before the electorate.
Referring to the Budget, the PM reiterated the move to continue some of the projects that were started by the previous administration. He explained that these projects were commenced without any finance and therefore, to continue these projects his government has to seek additional finance for completion.
“The circumstances have defined us, the inheritance has defined us. We are confronted with a situation where we have to finance on the capital front nearly all the projects commenced by the former administration and as I said before, this really has amounted to over $350 million.
“The choice that faces us is whether we continue with those projects or we abandoned those projects and concentrate on other projects. A lot of these projects were defined by reconstruction and we had said in our campaign that reconstruction is a priority so, it makes good sense for us to continue some of those projects and our capital budget is going to be defined largely by the inheritance that we have,” said Anthony.
On the matter of VAT, Dr Anthony explained that there were several factors that went into the selection of September 1st as the implementation date: “The former government had given commitments to international agencies that it would introduce VAT this financial year; commitments were given to the IMF, commitments were given to the World Bank.
“The second critical factor has to do with the financial state of the country. Our position was that we needed to ensure that our economy was relatively secure . . . We believe that the time is about right to do so. We have a huge fiscal deficit to deal with but at the same time, we think the economy is starting to show some incipient signs of growth.”
Dr Anthony again expounded on his disagreement with the former Prime Minister Stephenson King who claimed the economy of St Lucia had grown by 4.4 percent last year. This was a disagreement that was featured in his 2011 election campaign and he still maintains that the growth is much less than what was originally announced by King.
“I should, however, caution that the economy did not grow by 4.4 percent as claimed by the former Prime Minister. That is not established beyond doubt; beyond reasonable doubt and at the appropriate time I will clarify that. So now, what we are seeing is certain shoots of growth. Clearly, they would require watering and nourishment to continue to push the economy but what this economy needs is growth.
“The third factor has to do with Caricom; St Lucia over the last couple of years has been heavily criticized by Caricom because of the environmental levy. Countries such as Trinidad, Jamaica, even Guyana complain bitterly that the environmental levy was unlawful. The environmental levy was imposed on all goods coming into St Lucia and these countries were complaining that manufacturers in St Lucia use goods for the domestic market without having to pay the environmental levy for the goods they produce. The result was that the environmental levy was discriminatory. In my respectful view and in my judgment… if we had been hold before the CCJ, we would lose and Trinidad and those other countries… had threatened to take St Lucia before the Caribbean Court of Justice,” explained Anthony.
He further explained that the Minister for Foreign Affairs together with the Minister for Commerce attended a meeting in Guyana where they explained that there are “fiscal changes on the way that will do away with the environmental levy.”
“The fact is if St Lucia does not move quickly to deal with the environmental levy then we could well be hauled before the CCJ by other countries of Caricom. A similar fate has also met the security tax enacted by the former government. You would recall that last budget statement by the then Prime Minister Stephenson King the government imposed a security tax to make monies available for the police to carry out their functions. They delayed the tax largely because of electoral reason; they were too scared to introduce it and the opposition at the time never really criticized it because it was earmarked already.”
Dr Anthony again explained that countries within Caricom threatened to take St Lucia before the CCJ because this, according to the PM, was a similar tax as that of the environmental levy. He added that all of these were factored into making the decision about VAT to prevent a possible case where St Lucia would have to appear before the CCJ.
The seemingly relaxed PM also stated that the September 1st date would give St Lucians adequate time to prepare and get informed about VAT.
He noted that even now, there is much discussion taking place on the subject of VAT which allows him to make certain adjustments if needed before September arrives.

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