Philipsburg:--- Minister of Finance Roland Tuitt told members of the media at the Council of Ministers' press briefing on Wednesday that St. Maarten will become a member of Caribbean Organization of Tax Administrators (COTA). Minister Tuitt said that the COTA will be holding a seminar part of which is the general assembly. He said St. Maarten submitted a request to the COTA since 10/10/10 to become a member of COTA since the Netherlands Antilles was part of the COTA. Tuitt said that the COTA is the fiscal arm of CARICOM and the executive council of that body has decided that St. Maarten can become a member of the COTA. The Minister of Finance said St. Maarten will attend the seminar with the intention of developing bilateral agreements with the other CARICOM nations. Tuitt said COTA has a multi-national arm where treaties are made to avoid double taxation.
These treaties, he said, are made internationally especially for the Caribbean and it is for the collection of taxes and to avoid double taxation. The Finance Minister said it is therefore necessary for St. Maarten to become part of the COTA body and he will be traveling to Trinidad from the 18th to the 23rd of July to attend the COTA seminar. He said COTA has the multilateral treaty and being part of the COTA will allow St. Maarten to improve its international relations with the countries that are signatories to the multilateral treaty. Tuitt said when St. Maarten becomes a member of COTA they will be able to combat tax evasion and they will also be able to access and collect taxes.
Finance Minister met with WITU President --- COLA Payments will be made.
Tuitt also told the members of the media that he met with the President of the Windward Islands Teachers Union (WITU) Claire Elshot and the COLA payments were discussed. Tuitt said the budget amendments were approved by the Council of Ministers, and it was sent to the Governor and the Council of Advice before Parliament gets it for their approval. Tuitt said that even though Parliament is on recess, he already asked the Parliamentarians to make themselves available to approve the budget amendments during their recess time so that the COLA payments can be made.
Tuitt said thus far he met with both of the unions that represent civil servants and when he met with the WITU President on Tuesday they discussed various issues affecting teachers on St. Maarten.
The Finance Minister said he made it clear to the unions that St. Maarten cannot remain under the same structure of compensation and should not hold on to the COLA. He said there are only two countries in the world that use the COLA system, which proves that the COLA system is not sustainable for government. He said he asked the unions' representatives to bring some of their ideas to the table regarding annual compensation that will be more conducive to modern times. The Finance Minister said the teachers' salary scales were also discussed and government will look into the matter to see how that can be adjusted. However, government will have to work with the current salary scales until other methods are developed.
Tuitt also told reporters that the NA/DP/IND government intends to simplify the tax system and making it more conducive to the community. One of the ways of simplifying the tax system he said is to merge several of the taxes together which would lighten the paperwork for businesses and facilitate the work at the Receivers Office, these workers will not have to make several bookings. Government will merge taxes such as AOV and SZV then government will pay the various entities their percentages. He said certain parliamentarians submitted a request to make a law for real estate owners to pay more taxes but government is working on an amendment to take to parliament which would simplify the taxes and make everyone pay their fair share.
St. Maarten got Clean Slate from the CFT --- More information was Requested and Provided.
The Finance Minister said that in the past St. Maarten had lots of difficulties with the CFT when it came to approving the budget, but he can report that the CFT has given St. Maarten a clean slate regarding its 2012 budget.
Tuitt said that the CFT approved the documents that were sent to them including the budget amendments that were made. So far, there is no other stipulation in place for the CFT on the amendments. Tuitt explained that the CFT asked for more information on certain items. One of them is the Plan van ampak for the tax office. He said St. Maarten does have a Plan van ampak for the tax office showing how they will build up the tax inspectorate office. That document he said was sent to the CFT. Tuitt also announced that six persons will be joining the Tax Office and that will improve the staffing of the tax inspectorate.
The CFT also requested more information on the PIFA evaluation system that was implemented by the IMF. This system he said consisted of 28 items that they use to evaluate each country. Tuitt said St. Maarten did not get a good evaluation. Therefore, the government of St. Maarten has embarked on a five year plan that would at least give St. Maarten a B the next time the evaluation is done. That five year plan he said was also sent to the CFT.
Tuitt said the CFT also requested information on the old age pension system and the social funds that St. Maarten has. He said that a report on this was done and government is currently evaluating that report and they intend to develop a strategy to move forward with the dilemma of the pension. Regarding the pension funds, Tuitt said every country is having problems with that because there are more people taking out monies from the pension fund than those that are putting in. He said the Pension Fund of the former Netherlands Antilles had issues and the Pension Fund of St. Maarten also has some issues that have to be dealt with, one of those issues is the pensionable age which will be moved from 60 to 65. Another issue that the Pension Fund will have to look at is the structure of pension payment. "Right now, pensioners are receiving pension are receiving 70% of their last salary." Tuitt said that there are people who do not know how the pension fund works. He indicated that Curacao is having a problem with their pension fund because there are more people taking out monies of the pension fund than putting in. However, that is not the case for St. Maarten. Finally, the Finance Minister said the CFT requested an analysis of the financial statements of 2009 and 2010 which was also provided to them.
TAXAND Investigation.
When asked about the TAXAND investigation, Tuitt said he did receive an amount from SOAB for the investigation that will be conducted about the contract the former Minister of Finance awarded to TAXAND. However, the figure has not yet been approved by the Council of Ministers and he will not release it to the media. He did say that the figure is not huge and that the investigation will take at least five weeks to complete.
When asked by SMN News if the Council of Ministers will proceed to investigate the TAXAND contract, Tuitt said the Council of Ministers already agreed to an investigation because it's a large project and there would be need for proper documentation if the matter reaches the court.
Tuitt further explained that after the SOAB investigation, the Government of St. Maarten will decide how to move forward with the TAXAND payments that were blocked. He said government and its legal advisors will decide what to do when the SOAB submits it report and advice.
