(iWitness News) Vincentians will, this year, begin paying a higher rate of Value Added Tax (VAT), which is expected to move a further EC$10 million away from the pockets of consumers into the state coffers, even as the government said that it collected in 2016 more revenue than anticipated.
Prime Minister Ralph Gonsalves announced in his Budget Address on Monday that the rate of VAT will increase by 1 percentage point to 16 per cent as of May 1, 2017.
The change was among increases in a number of taxes that the prime minister announced as he presented the EC$976.4 million budget.
Departure tax at the nation’s airports will increase by 100 per cent, moving from EC$50 to EC$100 as of Feb.15.
In announcing the increase in VAT, Gonsalves spoke of the frequent occurrence of severe natural disasters and the extensive loss and damage to houses, physical infrastructure and economic enterprises, especially since 2010.
He said the Central Government has incurred significant costs in providing relief and assistance to affected households and businesses and for rehabilitation and replacement of damaged infrastructure.