Finance Minister Winston Dookeran on Friday cleared up a number of issues about the People's Partnership budget, noting that the opposition raised many issues not for clarification but to deliberately "create doubt as to the veracity of the government's ability to do what it promised".In winding up the debate on the budget Dookeran also stated that part of the problem that the opposition PNM has with the budget is the party's lack of understanding of the economic logic in the fiscal measures.
One of the issues that the opposition has been talking about is the new government's decision to scrap the controversial Property Tax bill and return to the system of Land and Building Taxes at the old rates.
PNM MP Marlene Mc Donald asked for clarification on the measure, noting that while the government was saying that it will return to the old tax rate the budget documents show that there is a projected increase of about $100 million from taxation of properties.
Dookeran said he based the budget on three issues, including the revised property ownership roll that the previous administration had compiled in preparation for the Property Tax.
He said that data showed that there were many more properties that had not been counted in the previous budget. In addition, he said the records show that there are outstanding land taxes amounting to $230 million.
Dookeran said that alone would account for the alleged discrepancy. He said that when combined with a general tax amnesty to allow people to pay outstanding taxes and the Board of Inalnd Revenue's new aggressive tax collection system, he anticipates that he would have all of or more than the anticipated revenue.
The minister also said the opposition failed to show how the Property Tax, which has now been scrapped, would have affected home owners and businesses.
He spoke of a Woodbrook address where the PNM tax would have brought in more than $2,000 as opposed to the new measures where the same property would pay just over $100.00. "There are no hidden taxes in this budget," he declared.
Dookeran also explained that contrary to misinformation from the opposition, the government is not creating a business oriented mega mortgage company that would deprive poor people of an opportunity to get an affordable mortgage.
He reminded the House of Representatives that the plan is to return the Trinidad and Tobago Mortgage and Finance Corporation (TTMF) and the Home Mortgage Bank to their respective roles. He said that was done to restore fiscal responsibility since those entities had been hijacked by Calder Hart and company.
Dookeran said the new mortgage holding company to be traded on the stock exchange would not hinder a person's ability to secure an affordable mortgage.
He also spoke about the CL matter, which has become a political hot potato with accusations that the government plan would pauperise investors.
Dookeran said the government chose the best of three options provided by industry experts and that option of setting a $75,000 ceiling for payment to investors would benefit more than half of the 28,200 short term investors.
He said the overall plan would benefit 225,000 CLICO policyholders, keep the industry alive and is the best solution for the 400,000 taxpayers who have so far contributed more than $7 billion to rescue CL.
He said the Finance Ministry will continue to listen to the concerns of all stakeholders, including the credit unions that have large investments in CL and have expressed concern that they could suffer financial losses as a result of the government's approach to dealing with the CL problem.
Dookeran said contrary to what the opposition has been saying the budget has won high praises from some of the most respected names in the business of fiscal planning, including the internationally recognised KPMG.
He said the government's approach has been and will continue to be based on using Trinidad and Tobago's energy wealth to create a sustainable economy rather than the PNM's approach of economic development without growth.
The minister also addressed the issue of the Alutrint smelter in La Brea. He said there is an alternative plan before cabinet, which the energy minister will outline at a later date.
However he raised two issues of importance. He said while the PNM has been claiming that the PP government arbitrarily closed the project it was the Manning administration that did it.
He read a letter from the Permanent Secretary in the finance ministry to officials in China dated May 7, 2010 in which the official stated that the government had no intention with proceeding with the project until the matter of an environmental review is settled by the courts.
"They stopped it, not us," Dookeran declared.
He also said there is an issue of two separate loans connected to the project amount to US$400 million, noting that the documents he has seen on the matter do not have enough information to determine whether the government has drawn down any of that loan.
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