Sandals Tax Settlement Rattles Opposition Timbers!

[dropcap]Y[/dropcap]et again curious gazes fall on Saint Lucia’s government as attention is drawn to the sudden end of an eight-year-old dispute. The issue, recently brought into the public domain, involves one of our beacons of luxury, the main reason you are likely to see a stunningly over-saturated image of simply beautiful Saint Lucia sliding along your screen during a casual stroll through social media: Sandals, more specifically Sandals Resorts International (SRI). Then there is that intruding but beneficial presence, the Inland Revenue Department—and a cash balance of $24.4 million.

The IRD claimed that for the period of 2001–2009 a payment should have been made in respect of withholding taxes assessed on insurance costs allocated to SRI’s three resort companies – that according to a statement from Sandals issued earlier this week. The amount totals $24.4 million inclusive of  accumulated interest and penalties.

The dispute, which was in August taken up by the Cabinet of Ministers, was officially settled, with SRI being exempted from accounting for the outstanding withholding tax. As the minister in the finance department put it: “In all fairness, we were given all the evidence and in Cabinet we looked at everything. We asked all the tough questions . . . we always come up with the right decisions on behalf of the government and people of Saint. Lucia.”

No surprise that the opposition Saint Lucia Labour Party begged to differ. According to opposition leader Phillip J. Pierre and his fellow MP Ernest Hillaire at a press conference Thursday, the exempted withholding tax in question is “monies to be allocated to the preparation and refurbishing of public goods.”They expressed concern with the Cabinet’s involvement, which they claimed was not regular practice. Normally, they said, unresolved disputes with the IRD are brought before commissioners. If still unresolved, they are taken to the courts, and then the high courts before the government intervenes.