~ Roy says the move would be 'magical' ~
PHILIPSBURG--The Executive Council will reportedly propose to the Island Council to increase the wage tax component of the 2010 draft budget with an additional 40 million in income for the budget year 2010.
It is understood that Government expects to collect these additional revenues by way of tax audits done over the years 2005 to 2008 on businesses that may have complied with their wage tax obligation but have not paid the correct amount.
The Executive Council will reportedly propose this measure during the Island Council meeting scheduled for March 22. Commissioner of Finance Xavier Blackman, who is currently off-island, could not be reached for clarification or confirmation.
Such a move may also be applicable to businesses that have withheld wage tax from employees but didn't pay the tax to the Island Receiver. Clarity could not be had concerning how and when businesses would be expected to pay, if the component is approved by the Island Council.
The Daily Herald further understands that assessments based on tax audits over previous years are possible, but businesses may also opt to appeal to the Inspectorate of Taxes when receiving such notices of assessment, and in the event the appeal is denied, they still have the option of taking the matter to the Court of First Instance in Tax Matters. The yearly wage tax income hovers around NAf. 120 million for the Island Government.
In an invited comment on Tuesday, former Commissioner of Finance Roy Marlin said he had no information to share about this possible proposal of the Executive Council.
Borrowing from the signature double-A trademark of St. Maarten's new branding strategy, Marlin said with such a "maagical move, the projected income on wage tax for 2010 would be close to NAf. 160 million. Whether this can be achieved with nine months in the year left to go is still to be seen.
"It seems like the Commissioner of Finance has taken over the strategy to balance the draft 2010 budget in a maagical way," Marlin said. He also wondered if businesses had not already usurped their excess cash flow as a result of the economic slowdown.
The Committee for Financial Supervision CFT would also have to accept the proposal as a viable revenue-generating method.
