Well aware that the country has not been enjoying the best of economic times in recent years, Trinidadians nevertheless baulked at this week’s presentation of the 2017 budget measures with some key sectors like gambling and car dealers complaining that new measures could well ruin them.
Amid fierce criticism from opposition and other critics about runway violent crime, foreign exchange shortages and declining future prospects for the lifeline gas sector, Finance Minister Colin Imbert pushed through with a several measures, aimed at turning the Caribbean trade bloc’s largest and mostly normally prosperous economy around from years of poor performances.
But once he had finished presentation in parliament, the country’s gambling sector immediately announced plans to lay off hundreds of workers because government had imposed a 100 percent tax on casino gaming fees, a move industry players say will immediately make the sector unprofitable.
The result is that six of the smaller casinos have said they will quit in the coming days and that many of the 9,000 people who work directly in gaming will have to be laid off as the sin tax is way too high to bear.
Sherry Persad, spokeswoman for the TT Members Club Association, said a good portion of the estimated 9,000 people who work directly in the sector will lose their jobs in the coming months unless authorities roll back or reduce the 100 percent increase.
“Based on our meeting at least six small clubs expressed closure. Termination of workers can reach in the thousands by year’s end in light of the implementation of the increase of taxes from January 2018,” Persad said. “Discussions will begin with the Union of Members’ Clubs and Lottery Workers (UMCLW) about the staffing implications of the taxes and provide counselling support where possible,” the Trinidad Guardian reported.
Indirectly, Persad and others say, gaming caters to about 30,000 jobs and people including security guards, taxi driver, caterers and others.
As the grumbling about the new tax grows, some of the bigger international casinos have also expressed fears about how tough it will be going forward with a doubling of taxes. Like their local counterparts, they want a sit down with Imbert and Prime Minister Keith Rowley.
Similarly disgusted are both new and foreign used car dealers, as Imbert has reintroduced taxes on hybrid gas and gas vehicles with engine capacities of over 1600 cc.
Incentives to import these cleaner vehicles were supposed to run until 2020 but government rolled them back after just one year. Dealers said the price of a vehicle will now move from around $15,000 to about $30,000.
Automobile Association President Visham Babwah said the move will bankrupt dealers who remain quite perplexed as to why the incentive period was cut by three full years.
But the administration, which won general elections two years ago, also attempted to win hearts and minds. All ministers will take a five percent salary reduction as part of the national sacrifice in tough economic times.
“There is something that we have not publicized. The cabinet took a five per ent pay cut last year because we were mandated by the prime minister to take five percent of our salaries and give it to charity. We have all been doing that but we did not publicized it. Perhaps we should have. That is on gross. That is not after tax. That is before tax. I give $2,000 a month in various charities to my constituency and all of us were mandated to do that. So we have been sacrificing for quite a while,” said Imbert.
Some other key measures include a cut in the national fuel subsidy, allowing for annual saving of about $100M. Subsidies for last year totaled about $150M
Monday’s cut in the fuel subsidy will see government saving $550 million.
“It will increase the cost of transportation and that will find its way into the cost of goods and services. But we felt that we could not continue with two subsidized motor fuels to the extent that we had in the past,” he said in defense of the politically unpopular measure.
Oil prices have been cautiously fixed at $48 per barrel despite rates being higher on the international market but Imbert said the new regime of taxes will help pump more finances into state coffers.