Former Civil Service Association (CSA) President, Kingsley St Hill, has told the Times that Value Added Tax (VAT) is going nowhere.
United Workers Party (UWP) leader, Allen Chastanet, had announced during the general election campaign that if elected, his administration would ultimately eliminate VAT.
The announcement brought sharp criticism from the then ruling Saint Lucia Labour Party (SLP).
The SLP observed that removing the tax would stop the country from earning EC$ 346 million in revenue, when EC$ 400 million is needed to pay civil servants, teachers, nurses and police officers.
The party had warned that scrapping VAT would lead to retrenchment of those workers.
Former CSA President, Kingsley St Hill, told the Times that UWP leader and new Prime Minister, Allen Chastanet, had already dealt with the matter by saying last week that he would consult with the Caribbean Development Bank (CDB), the International Monetary Fund (IMF) and the World Bank.
“Those institutions actually recommended that the Islands of the region choose VAT,” St Hill recalled.
He asserted that because Chastanet has said that he will go to them, he expects that the institutions will stick to their recommendation.
“I don’t see the matter going any further,” the former CSA President declared.
St Hill said that the tax may be reduced by one or two percent.
“VAT will remain – I don’t expect it will go anywhere, especially since he (Chastanet) is going to those institutions that recommended VAT,” St Hill told the Times.
St Hill is also a former President of the National Consumers Association (NCA).
Chastanet’s UWP won the June 6, 2016 general elections by a margin of 11 to 6.
The UWP leader had said that the imposition of VAT, high unemployment, and a 66 per cent increase in the cost of piped water, have impacted the nation heavily, with many people finding it difficult to manage their households.