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Please pay us!


by Shawn Cumberbatch

Government owes Barbadian businesses almost $50 million and its failure to pay is threatening the jobs of a number of individuals, creating cash flow problems, and tarnishing the reputation of these enterprises.

The concern was raised today by the Barbados Private Sector Association, which revealed the results of a survey of 25 companies across several segments of the private sector that are due various forms of payment from the state.

But the statement was countered by senior Governmentsources, who though acknowledging the arrears, said members of the same private sector who now owed Government hundreds of millions of dollars related to the ones they are claiming should tell the full story.

News of the challenge facing corporate Barbados was communicated in a BPSA news release, in which it expressed concern about “the high amounts of government arrears owed to companies in Barbados”.

“The BPSA is calling on Government to give urgent attention to settling its existing arrears to the business community,” CEO Anne Reid said.

The association said it recently surveyed the two dozen companies and they reported that Government owed them about $49.6 million “in the form of Value Added Tax refunds, Corporation Tax refunds, Diesel Rebates or sums owed for the supply of works, goods and services to the government”.

The money due included $14.2 million to suppliers of services, $13.8 in VAT refunds, $12 million to suppliers of goods, $4.5 million to providers of works, $3.9 million in corporate tax refunds, and $1 million for diesel rebates.

“The arrears created cash flow problems which curtailed the ability of some firms to meet their obligations to suppliers, receive credit or meet their obligations to Government. In some instances, payments to both local and overseas suppliers are compromised,” the BPSA said.

It added that “some firms have hinted that their ability to maintain staffing levels may be compromised if the practice of substantial arrears and lengthy delays in repayments continues”.

The organisation said it “has already communicated the results of its survey to the Government of Barbados through the Ministry of Finance”.

“The survey confirms that these outstanding arrears are impacting negatively on the business operations of a high percentage of the firms surveyed. Approximately 68 per cent of those surveyed indicated that the arrears had a significant impact on their operations,” the private sector agency said.

“It is also important to note that of this 68 per cent, the impact on firms across all categories, that is, micro, small, medium and large was significant. In other words, the size of the firm did not appear to have any major bearing on the impact that the outstanding arrears had on their operations,” it added.

An official in that ministry said the BPSA should be fair and also say how much its members owed Government, since this was a major part of the problem.

The official said that up to today “the current state of arrears owed to the major Government revenue collecting agencies and departments”, which included that owed by businesses, included $361.1 million in VAT, $291.4 million to NIS, $153.8 million in land tax arrears due from companies and individuals, and $79.6 million in corporation tax.

One Response to Please pay us!

  1. Robert January 21, 2013 at 9:25 am

    When a company is in arrears on VAT, N.I.S., corporate taxes, or property taxes, the government’s responsibility is to take action and recover the monies owed it, however, if businesses have a clean record on paying on time all fees and taxes due to the government, there is no reason for government not to refund what is due to these businesses. Let’s not muddy these two different situations by lumping them together. By not refunding to law abiding businesses, both large and small, what is due them in a timely manner, the cash flow of these businesses will be adversely affected and can lead to job cuts, and worse business closures. Government has a responsibility to do the right thing as well and stop playing the blame game.


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