Chamber members engage government on 2023 Budget and impact of new taxes

Chamber members engage government on 2023 Budget and impact of new taxes

Members of the St. Lucia Chamber of Commerce met with a delegation from the Ministry of Finance to discuss key elements of the 2023/24 budget. Among the measures discussed were the Health and Security Tax, the Tobacco Levy, VAT Relief on selected construction material and incentivization of installation of Photo Voltic systems.

The government delegation addressed some key issues areas among them the Budget Deficits, the recent and projected growth rates (GDP) (12% in 2021, 18% in 2022, 5.3% for 2023 and 6.3% for 2024).

The Chamber members were also told that Debt to GDP Ratio moved from 95% in 2020, down to almost 68% in 2022 and forecasted to approach the target of 60% by 2035 set by the Monetary Council which is the highest decision-making body of the ECCB.

The 2.5% Health and Security Levy, expected to recoup some EC$35 million. Firms that fall below the VAT registration threshold will not be expected to pay the Levy.

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The Business Community raised a few concerns during the engagement, among them the added administrative and financial burden the new taxes would introduce, the direct impact on firm’s bottom line, the dampening effect on consumption, the inflationary impact in an already high inflation environment, as well as the impact on the IT Sector as an enabling support sector.

The Chamber also strongly called for Government to conduct public education and public relations exercises to inform and prepare the public for the consequent price increases some of the measures would cause.

Chamber Executive Director Brian Louisy, specifically spoke to the public backlash that businesses are likely to face with price escalation which they had no control over and being unfairly accused of price gouging

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