Antigua and Barbuda looks to increase sales tax

Antigua and Barbuda, under the guidance of Prime Minister Gaston Browne, might soon see income tax rates increase as the government wishes to tackle increased financial requirements which include increments for public servants.

The PM stated that the decision will be made by next week, while adding that increasing the Antigua and Barbuda Sales Tax (ABST) is the best option available when it comes to increasing the government’s revenue.

Prime Minister Browne said the following in a statement addressing the matter, “If we increase the ABST by about one or two per cent, if it is two per cent we will raise about EC$40 million. Now we are faced or will be faced with increased obligations to cover the increase in pay to public servants and we are determined that they must get their 14 per cent increase and that is going to cost us nearly EC$40 million and I say the most reliable way to ensure that is paid is to increase the ABST by two per cent.”

“We are mulling it over; we have not made any determination but I just want to signal to the public that we may have to do that to ensure that we can meet not only existing obligations” he added.

According to information furnished by Prime Minister Gaston Browne himself, the government’s annual spend on salaries, emoluments and wages comes up to EC$36.8 million. At the current moment, the state is obliged to make payments amounting to EC$60 million or more.

He also mentioned the government’s commitment to the Four Island Campus of the University of West Indies which requires EC$20 million annually. It is an expense that the government did not incur three years ago but has to manage now.

“When you look at the monies we have spent on education…the borrowing to support the repairs and expansion of our roads, the borrowing for the university as well…we also have to find money to pay that EC$80 million loan.”

The government now has the uphill task of making sure that the decision to increase income tax is accepted and not met with resistance before it presents the National Budget to the parliament on the 5^th of December.