Not yet, but I prefer to remain optimistic.” That was how, the ever soft-spoken executive director of the Saint Lucia Chamber of Commerce, Brian Louisy, reacted when asked whether the Chamber had been consulted regarding a review of the Value Added Tax.
The Prime Minister had promised that VAT would this month come under review, at the same time admitting the possibility of what he referred to as teething problems and moments of anxiety following implementation last October.
As usual calm and collected the always affable Louisy acknowledged moments of discomfort and anxiety within the business sector. On the other hand, Paula Calderon has never been famous for buffering up her public statements or for sticking within the borders of political correctness. The Manufacturers’ Association president had always warned that Saint Lucia’s manufacturing sector would suffer severely under the new tax regime.
She had persistently fulminated against the imposition on a number of items including medicine, computers and donations. Incessantly, she called for more dialogue on the issue, especially her membership’s concerns about the processes involving importation of goods and raw material.
Soon after VAT was introduced Brian Louisy had told the STAR his members had been advised to “temper their assessments” of the new tax system “with caution.” To hear him tell it, the Chamber expected that people would experience some discomfort and some anxiety but he wants his members “to be a lot more measured in what we say.”
They had been asked to identify whatever issues they might be concerned about “and if it is something we can speak to as a body, we will do so.” He added: “Initially you expect that shock factor.”
On Tuesday this week the STAR spoke again with the Chamber boss at his office in Vide Boutielle, not only about the issue of VAT but also about the recent CSA strike. We also addressed the upcoming Budget debate.
As far as VAT was concerned: “The Chamber will conduct an impact assessment and we are trying to get some information from our members. We have not yet conducted a specific survey, a specific study. But from the discussions with our members, what we are getting is that the last six months have been a difficult period. There has been a slow-down in business activity and drop in sales.”
Candidly, Louisy sounded to me like a very tired man. Without scientific data at his disposal, he said, he was not sure how much of the down-turn in business activity could be attributed to the new tax regime. But there could be no disputing the coincidence.
“Since the VAT regime it has been terrible for business,” he admitted. The survival and sustainability of the business community was of “paramount concern at this time.”
Come Budget time, he said, he was looking forward to an extensive VAT exemption list.
“The challenges we saw coming out of the design of VAT was that extensive list which we have always expressed concerns about because of the way it results in businesses not being able to claim the input VAT on the goods that are VAT exempt. We have made representation for a revisit of that, and are hoping there is a revision, because it does negatively impact, not just the business but also the consumer.”
By informed acccount, the Prime Minister met with Chamber representatives on Monday this week to discuss submissions to the upcoming Budget.
“He sought clarification on some of the things we have been talking about,” Louisy confirmed. “One issue concerns the ease of doing business. We think it is essential that the nation works towards making it easier to do business. It impacts the bottom line directly, it impacts investments and economic growth and we think we are seeing commitment
and decisive steps on improving our ranking when it comes to the ease of doing business.”
As for the CSA strike Louisy said he was happy to see workers now back on the job. “I think the business community was affected, particularly in the area of the lower courts where things like mortgages could not be processed, where financing and deeds could not be done —and that has a direct impact as it affects the conduct of business investment with other transactions.”
There was a slow-down and adjustments had to be made at the ports of entry, Louisy said. The area of meat imports was also impacted, since in some cases the veterinary division of the Ministry of Agriculture was not in a position to approve the entry of some of these goods.
“So, yes, overall we are happy to see that the civil servants have decided to return to work. We think that it is the right thing to do. We always felt the strike was inappropriate,” said Louisy.
However, he regretted that the entire process seemed to be dragging on with the GNT and CSA expected to meet yesterday (Friday). “We are of the view that if both parties have indicated that there was an impasse then the logical
step is to go to arbitration. But we note that they have gone back to the table and only hope a resolution can be arrived at sooner rather than later.”
Brian Louisy remains, as always, “hopeful and optimistic.”