Monday, July 16, 2012

Commentary: Why are we getting hysterical about a property tax?

The opposition People's National Movement (PNM) is making a big issue of comments by Finance Minister Larry Howai that are reported in the Sunday Express in an article headlined: Tax Must Come Back. The report is based on an interview the newspaper conducted with Howai last week. 

The paper quoted Howai as saying, "We have to bring back that property tax. It is costing the Treasury money (in lost revenue) that could be used to develop the country. I do need for us to revisit that property tax and consider introducing something more efficient, effective and more equitable than proposed previously."

The PNM and other government critics have jumped on the minister for that claiming that Howai is saying the government is bringing back the PNM tax. It is also saying that Prime Minister Kamla Persad-Bissessar campaigned to kill the tax and now her government is reneging on that promise.

I don't see how anybody could interpret Howai's comment to mean that the PNM tax of 2009 is coming back. That tax is dead.

This is the part of the comment from the minister that the critics seem to be missing: Howai told the Express the government must consider "introducing something more efficient, effective and more equitable than proposed previously." That is a clear statement that whatever he is contemplating it is NOT the tax that the people revolted against.

To make its point the PNM is even circulating on the Internet a report by Guardian political correspondent Gail Alexander that was published on December 22, 2009.

This is what the paper reported:

"The UNC will scrap the property tax when it forms the next Government, UNC deputy leader Kamla Persad-Bissessar promised yesterday...Persad-Bissessar, deeming the tax a poverty tax, said the UNC would take the Government to court if the property tax legislation was passed in the way it was currently framed. “This is the biggest con job I’ve ever seen,” Persad- Bissessar said, adding she was not supporting the bill."

That's what the lady promised. She and her colleagues in the People's Partnership campaigned against the tax and when they got in office they scrapped it. Since 2010 homeowners have not paid any property taxes.

Howai's predecessor, Winston Dookeran, had indicated that some form of property tax would be reintroduced so there is continuity in the economic thinking and planning. 

But those with an anti-government agenda are injecting fear and hysteria in the country with their hype and spin. I hope people would read the report and not be confused by the misinformation.

In the Express story Howai explained that it is fair for a government to impose some form of property tax in order to pay for essential services provided by the state authorities. 

"Property taxes exist virtually all over the world because if you own a property, there is a cost attached to it at the micro and macro level: garbage, sewage disposal and everything that goes with maintenance," the paper quoted Howai as saying.

"By and large, most people expect they have to pay some kind of land and building taxes, but what they felt was the last legislation probably may have been a little bit heavy-handed, and so they rebelled against it," he said.

What I understand the minister to be saying is:
  • A property tax is necessary; every country has one
  • The PNM administration's tax was too heavy handed
  • The government wants to introduce an efficient, effective and more equitable tax than the one proposed by the previous administration
The minister is very clear on his plan, which does not include bringing back that oppressive tax the PNM tried to push on people. We have to wait and see before passing judgment.

I expect the opposition to keep the government accountable. However it is wrong for it to distort facts to mislead people. That is gross irresponsibility.

Jai Parasram | Toronto 16 July 2012

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Jai & Sero

Jai & Sero

Our family at home in Toronto 2008

Our family at home in Toronto 2008
Amit, Heather, Fuzz, Aj, Jiv, Shiva, Rampa, Sero, Jai