VAT Thieves

Submitted by GoWeb Caribbean – (blog written by Caswell Franklyn)


Since the election in January 2008, I have refrained from criticising the DLP Government.  As some have suggested, my silence had nothing to do with my becoming a member or supporter of the Dems.  I have not.  I wanted to give the new Government a chance to govern, without me as a distraction.  I also felt then as I do now that the two alternate options offered by the BLP (Arthur and Mottley) were the worst possible choices to be prime minister, and I did not want my comments to be seen as giving aid and comfort to either of them.

While I do not want my criticisms to be of benefit to the current BLP leadership, I must object to some aspects of the 2010 Budget.  I cannot understand the lack of informed opposition to the Budget.  Either they remain on an extended honeymoon, or the country is convinced by the Government’s excuses for its failure to perform adequately by blaming their shortcomings on the global economic crisis.

The Minister of Finance has inflicted devastating tax increases that will hurt the poor and middle classes unnecessarily.  Their apologists claim that those punitive tax increases are for the greater good.  I have no difficulty if that were the case, but I remain unconvinced.  If Government did not believe that it could get away with anything at this time, it would not increase the VAT rate now.  Every effort should have been made to collect the millions that VAT registrants collected from the public and criminally put in their own pockets.

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0 thoughts on “VAT Thieves

  1. … and how much does the VAT Office owe to those of us that have been diligently paying our VAT on sales and not getting back the VAT claimed on purchases?

  2. Value Added Tax is refundable to non-residents. It would be interesting to know just how many tourists claim back their entire VAT entitlement. I would guess that the government is making a killing off that.

    I would also note that VAT is not chargeable on membership dues to statutory organizations, like the Barbados Bar Association. Yet, the BBA illegally charges VAT to its members and presumably these ill-gotten gains go into the government kitty.

    Having said all that, VAT is set to rise, if it has not already risen, in ALL countries that use it. I suppose this is what we pay for the boom or bust policies of those government over the last 16 or so years. Therefore, the blame, it seems to me, lies not with the DLP (Thompson and Stuart) who inherited the mess, but with the BLP (Owen Arthur) the boom or bust experts who created it.

    • @Go Web/Caswell

      On November 29, 2010, I went to the Registration Department and did a search of the VAT Judgement Register. I was abhorred to see the names and the amounts owed to Government. Those who had judgements registered against them included millionaire businessmen, lawyers and even debt collectors.

      If this information ios a matter of public register why not name a few of the companies?

  3. Amused,

    ‘Value Added Tax is refundable to non-residents’

    What if every visitor claimed back the VAT on accommodation, meals, car rental, activities and attractions, shopping etc?

    Are you sure?

  4. Never heard of that part myself. If they did you would see massive drop in the vat revenues. That would about double the current account shortfall.

  5. @Adrian. Surprised that you do not know how this works. They cannot claim back for services and goods “consumed” while in Barbados, but they ought to be able to for goods that they buy to EXPORT on a non-duty free basis. Many times I have purchased clothing and computer goods to take from the UK home to Barbados and been able to reclaim my VAT, which is credited directly to my credit card. So they cannot reclaim for what you offer by way of hotel and meals etc., nor car rental. The watchword is “export”. Now, this may have changed, but that, in the interests of your guests, is something for you to find out for them. Once you have done so, the fruits of your investigation would be much appreciated by us all.

    However, my rebuttal is aimed, not at this aspect, but at the suggestion that the DLP government is responsible. I take it you know that VAT has been increased in the UK by the Tory government in response to the terrible financial mess left by the Labour government. It would seem to me that the DLP is in the same boat.

    I would also note that VAT percentage has a habit of sliding as finances improve or disimprove. 15% to 17.5% to 20% and back to 17.5% and back to 15% etc. I would hope that the DLP will decrease VAT once the country’s financial status improves. Indeed, I am content that it will do so. Therefore, the blame for the necessity of the increase ought to be placed firmly at the door of those who made it necessary, not those who were forced to implement it.

  6. The question is What is government doing tp recoup the massive amount of money owed to it, for example, from, VAT, Property taxes, BWA, Natural Gas Corp, NIS, Road taxes among others? I’m sure this can easily amount to $ 1000 million, yet the average taxpayer is the one penalised for the inadequacies of the government depts who are obviously not doing their work. The bulk of this money is owed by persons who can pay immediately or over a period of time.

  7. @ Amused:

    That the mess probably started with the BLP is erroneous, boom and bust is the nature of the beast, a beast created out of private enterprise and investment. The bubble will burst and blow up again: rinse and repeat. It’s convenient to blame politicians and complain that they led us down this route and it’s their fault but the electorate facilitated their leadership with their votes and enjoyed the financial options as a result of this fragile paper model upon which we depend. And like I said, private enterprise has driven this model, laying blame at any one government or politician is faulty and misses the broad picture. So the next time you casually whip out your credit card think carefully of these facts.

  8. Amused | December 11, 2010 at 7:56 AM |

    I would also note that VAT is not chargeable on membership dues to statutory organizations, like the Barbados Bar Association. Yet, the BBA illegally charges VAT to its members and presumably these ill-gotten gains go into the government kitty.

    Are you positive the Bar Association is a statutory organisation?

    That is hard to believe but maybe it is.

    I think of BBA in terms of BAMP for the Doctors, BAPE for the Engineers and BIA for the Architects.

    I don’t pay VAT as a member of BAPE as far as I can remember.

    Give us a list of Statutory Organisations of some of the Statutory Organisations which don’t charge VAT.

  9. Government does charge rather steep licensing fees it collects each year from Doctors, Engineers, Architects, Dentists, Dental Technicians and other professionals when it licenses them at the beginning of the year to practice their profession and offer their services to the public under the relavent acts which contol the practice of their professions.

    These fees were increased in the case of Engineers, fivefold in a recent budget, probably the same for other professions.

    I am not sure if Doctors charge VAT on the fees they charge for their services although I doubt it.

  10. Amused

    I suspect you may be confusing the statutory authority that the Bar Association has to fix the fees that its member’s charge the public with membership fees and subscriptions.

    The fees its members charge the public do attract VAT.

    At the time of the 2004 report, it was the only professional body so empowered to fix its members fees by statute, according to that report if I read it right.

  11. So far no one has referenced the recent comments made by William Layne PS in the Ministry of Finance. Based on reports in both the Nation and Barbados Today he indicates that Barbados faces an uphill battle in stemming corrupt practices. In the speech as reported in the Nation he states that corrupt employees are simply a reflection of the nation from which they are recruited. Layne’s focus was mainly on the challenges faced in policing the Revenue collecting agencies of the Gov’t.

    Layne observed that many Barbadians were living above their means and wanted luxury goods so “they are going to be corrupt”. He also touched on the scams within the Customs Dept. that deprive the Gov’t of much needed revenue and the difficulty in prosecuting those who are charged with fraud related offences.

    Well at least one senior civil servant is not afraid to speak his mind about some corrupt practices, I hope he has the ear of the PM and the Gov’t does more than pay lip service to the issue however based his remarks one can conclude that this state of affairs will not be easily rectified since many people are also afraid to speak out.

    If people are not paying VAT to Gov’t after it is collected from customers, that is par for the course.

    What a sorry state of affairs.

    • @Sargeant

      PS Layne is not citing anything new. While many take solace in the favourable rating of Barbados by Transparency International we know there is a problem of the will to prosecute the ‘big’ fish. If we take Layne’s position to a logical position it means we have crooked politicians as well. So far we have not had any being prosecuted.

      Let us see some names of companies not paying the VAT. The VAT officers are paid to do a job and the Act supports them all the way.

  12. David

    Of course he is not saying anything new, but he is saying something. Too often we get a “no comment”; or they will have to “look into it” or calls not returned from public servants.

    What other Civil servant has been willing to call a spade a spade? I know the Auditor General lays a report before Parliament where he speaks about “inefficiencies” within certain Depts but apart from a pre election Thompson the only place that you have been hearing about corruption is on the blogs. Seemingly everyone with the power to do something about it have their collective heads buried in the sand.

    To your point about naming delinquent companies I agree let’s name and shame them (but I doubt they have any of the latter)

  13. @ David

    I am privy to at least one of the companies, but ultimately it’s up to Caswell, who you will come to see is very well informed, if he wishes to disclose any deeper information.

  14. In some countries you can reclaim VAT on exported items. I know this is true of Canada and the UK, although they seem to put all sorts of challenges in your way.
    Barbados has a duty free process for visitors – in certain stores. Cave Shepherd and the like do it. Visitors have to produce a passport and return flight ticket and the store produces a special “invoice”. One copy of this is meant to be dropped off at the airport.
    I would be interested to know if there is some separate process for other general VAT reclaims for export. That would definitely be a selling point for tourists.

  15. @John | December 11, 2010 at 12:17 PM | . I am confusing nothing. I said “membership dues”. I am well aware that costs charged by a lawyer to a client attracts VAT. How could it be otherwise? It is a non-statutory service.

  16. Jouvert | December 11, 2010 at 10:40 AM | . I agree that there are ebbs and flows in the economy of all countries. However, it seems to me that today we owe our relative fair financial health to the DLP administration of the reviled Lloyd Erskine Sandiford and the measures introduced by his regime that his successor did not get around to dismantling. I would note that Sandiford’s MOF was the late David Thompson. So, while having no political agenda whatsoever, I am forced to conclude that Barbados’ finances have been saved over the last 18 or so years by the “Thompson Factor” and it looks as if the Thompson Factor is expected to do it again.

    @ John | December 11, 2010 at 11:09 AM | Yes, I am positive that the BBA is a statutory organization. However, I am sure, from having read your input, that you are getting confused by the government’s right to licence professional people. That is a separate and distinct charge from the BBA fees. If you want a list of statutory organizations like the BBA, I don’t have it as I am only concerned with the BBA. This is one that you will need to do your own research for yourself. I am not sure that there is an easily accessible list. That all aside, I am fully content and satisfied that the BBA, being a statutory organization, has no right to add VAT to its members’ membership dues. That it does anyway, shows the level of lawyers that run it. And that has to change. It is because of the cover-ups and extremely lenient to non-existent penalties that the BBA has exacted against its members against whom complaints have been received from the public, that we need to question the management of the BBA.

    Look, in a nutshell, it is all very well for that jackass Leslie Haynes to get up and criticize the courts – and believe me, the courts are in a mess and need to be criticized, but NOT by a body with so much shite on his own feet.

    It is true that the court is barely functioning, due partly to incompetent and recalcitrant judges, BUT also in large measure to (Lady) Marie McCormack Simmons and her understudies in the job of registrar. That has to be addressed and redressed.

    HOWEVER, what also needs to be addressed with no less urgency is the disciplinary role of the BBA in offering AND DELIVERING to the public just redresses for their grievances against lawyers. I personally know of at least 10 members of the BBA who should not only have their asses disbarred, but ought never to have been called in the first place. I also personally know of at least three QCs to whom the joke when I was at school aptly applies: “Stupssssse! QC?!!! Yuh mean JuC????!!!!” Which is an insult to JuC. Let me tell you now that it really depresses a body to have to write to and address these idiots in a “fraternal” manner. It burns a bodys tail end to have to call them “my learned friend”. And it is very upsetting when a body gets tarred with the same brush as them and lowered and demeaned in the public’s perception. And it is very upsetting when, after years of upholdin the law in the sense of “justice for all” and doing a lo of pro bono work for poor people to ensure that justice is indeed for all, a body is tarred with the same brush and lowered and demeaned in the public’s perception by those who do not seek to uphold the law, but only to find loopholes in the law and the spirit of the law from which they can exact financial gain.

    Therefore, it is time for all to call upon the senior members of the Bar to debunk interlopers like Haynes with their political agendas and patronage that bring the BBA into disrepute and take over the running of the BBA and aid the delivery of justice to the people.

    I vexed. Fraternity is not as good as it is reputed to be!!!!! As it used to be!!!!!!!

  17. Amused

    I thank you Sir for your fair and balanced assessment.

    For years I have been hearing about the despicable acts of leslie haynes,his horrible behaviour to his staff and the fact that he is not even a sharp,intelligent attorney.

    His only claim to fame is his association with the Barbados Labour party and perhaps his pale skin.

    Despicable man I have been told who has no right as the head of the Bar Association.

  18. @mash up & buy back | December 12, 2010 at 8:53 AM | Thank you, sir. In fairness, I feel impelled to point out, however, that the lawyers who do a lot of pro bono work have a very large contingent of “paler skins” among them. Many of these are descended from our traditional families of lawyers. The names Hanschell and Williams/Marshall resonate in ths respect, among others. What I am saying is that Haynes is a competent (but no more than competent) attorney whose paler skin certainly does not put him into the category of skins – dark, medium or paler – that are the top of the legal profession. I have no idea how much pro bono work (if any) Leslie does. I reiterate that he is competent, but it is my observation that he is not really of the calibre that should adorn the Inner Bar.

    The fact is that all top counsel ought to give some of their time to pro bono work for poor people. And indeed ought to give some of their time to the governance and government of their profession and protect it against the sort of hits it has been taking at the hands of incompetent and dishonest practitioners.

    I still vexed. I fed up with people saying, “Lawyers? Yuh mean Liars!” If the BBA would just transparently do its job, this perception would be greatly reduced so the ones who actually do giv their all for the advancement of justice could get on with their jobs.

  19. Amused

    I went to to find out what a statutory organisation is. Here is what I found.

    Organizations that have to exist by law. They are government funded, ‘free’ services (although not actually free as our taxes go towards them)

    Are you telling me that the BBA is funded by our taxes, ….. or that the answer is wrong?

    I just cannot see how the BBA qualifies as a statutory organisation.

    I’ll see if I can find the act that establishes it.

    If I can find the act I’ll let you know.

    I am pretty sure there will be an act regulating the practice of the legal profession, but somehow I just cannot see the need in the act for defining the BBA.

  20. @John. I don’t mean to dodge your questions, it is just that they would require the sort of extrapolation and search on my part that I really don’t have the time for just right at the moment. Please accept that the BBA is statutory. I expect major shake-ups within the BBA fairly shortly. The present situation just simply cannot be allowed to continue. We create a top overseas (off-shore) investment climate, but it will start to unravel – UNLESS the legal infrastructre is not only in place (which it is) but works and can be seen to work. That will also require major shake-ups within the judiciary and its support organisations, like the Registry. No responsible government will allow the present situation to continue and I have every confidence in our PM and our incoming (no matter what the Nation may think) Chief Justice Gibson. Understand me, that is not to decry the excellent efforts made post-Simmons by Freddie Waterman and Sherman Moore – but neither of these could responsibly start major changes, due to the fact that they were just keeping the seat warm for Chief Justice Gibson. The late David Thompson, as a most worthy member of the Inner Bar, was well aware of the problem and Mia is also a member of the Inner Bar and she is well aware of it as well. However, the hijacking of the leadership of the Opposition by the very person that appointed Simmons means that you can rule out any sort of agreement with vital changes that have got to be made.

  21. Amused,”I fed up with people saying, “Lawyers? Yuh mean Liars!” ”

    Lawyers are human. They want House in Shady Lane and Mercurial Bents to drive bout an it cost money to fly de youn ting to de Client meetin in New York or to “get some ress”(pon a female cushion) in Miami or Torona.

    Dah is why some ah dem are Liars. But nut all.
    I cuh swear fuh Amused and Anonlegal cause dem doan lie to me.
    I only know dem pun BU an dem doan lie pun hey.

  22. Amused

    If the BBA is a statutory organisation setup by an act of parliament then the GOB obviously sees a need for its existence.

    Logic would then dictate that our taxes from the consolidated fund go towards its upkeep.

    Those taxes come from various sources including the VAT I paid on the pack of nuts I bought at the supermarket the other day.

    It then seems unreal that a lawyer would object to paying VAT on membership dues when the public is paying VAT on anything from a pack of nuts back up to support the BBA.

    What ……. you mean the lawyer wants to avoid contributing to the upkeep of his own association and would accept that the puplic pays?

    I was hoping you would have been able to confirm that a subvention was being paid to the BBA by the GOB and to quantify the amount.

    You seem to be quite knowledgeable about the profession so try and find out how much the public is contributing either by way of VAT or otherwise, to the upkeep of the BBA.

    I’ll take you the next step in the logic when you or someone else can confirm or otherwise that BBA is funded by taxpayers.

  23. @ David
    I don’t know if Caswell was following the comments but I have informed him of your request. As I said though, up to him if he wishes to share names. You all are anonomous, we aren’t.

  24. I do not represent business as usual. I would be very willing to let anyone have the list of VAT defaulters that I researched. However, I do searches for a living. That’s how I pay my bills. I don’t see anyone offering to acquire my services.

  25. Man comes out de high Court and sit pun de step.
    “Man de PHucin Lawyers is “Rasshooles” he shout
    Nuddah Man Passin goin in de Court get vex and say “I object to that”.
    1st man “sorry brother ,I vex,wid you lawyers”
    2nd,man,” I ent nah lawyer”

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