Inniss: Delay in foreign exchange levy will hurt revenue target

Minister of International Business, Small Business Development, Industry and Commerce Donville Inniss agrees with local economist Jeremy Stephen that Government’s delayed rollout of its controversial foreign exchange fee (FXF), will seriously hurt any chance of achieving the $542 million budgetary target.

Last month, Minister of Finance Chris Sinckler revealed a $542 million package of belt-tightening measures, which included the two per cent levy on foreign exchange transactions that was to take effect on July 1, aimed at wiping out the entire national deficit of $537.6 million in less than a year.

But in a statement late last month, the Central Bank said the measure would now be implemented in two phases, beginning with its application to cash, bank drafts and wire transfers on  July 17, 2017, followed by credit, debit and travel cards on September 1.

Acting Governor Cleviston Haynes said the delay would give the Central Bank more time to educate Barbadians about the foreign exchange fee, so that they would be clear on what types of transactions it relates to and how it would be applied. He also made it clear that the FXF would be applied to the Barbados value of the foreign currency transaction and that “all persons conducting purchases of foreign currency will be required to pay the FXF, except residents and non-residents making payments from their foreign currency accounts, including entities in the international business and financial services sector”.

Foreign currency sales related to the settlement of transactions for the bulk purchase of petroleum, diesel or jet fuel have been exempted from the FXF.

However, in an interview with Barbados TODAY over the weekend, Inniss, who had earlier expressed reservations about the levy, expressed little optimism that Government would rake in the anticipated amounts of the levy in the now much shorter time frame.

“If as a Government we projected to collect a certain amount of revenue over a time period from a particular initiative, and one of those parameters has changed, then that ought to change the outcome. So, if the period for which that levy condition applies has been changed, then ceteris paribus [all things being equal] I would expect that the revenue intake would also adjust accordingly,” Inniss contended.

However, as to whether or not the delay would result in an even longer period of austerity than originally envisaged, Inniss said he was leaving it up Sinckler to deal with the effects of any revenue shortfall.

“There may be some other areas in which you exceed expectations of revenue collection. So, I really would leave it up to the Minister of Finance to figure out such, because I don’t know all of the variables and all of the expectations according to the models that all of the economists have drafted,” he said.

28 Responses to Inniss: Delay in foreign exchange levy will hurt revenue target

  1. Mark Rosmar July 12, 2017 at 1:36 am

    Barbados is doomed. Basically a tax on borrowing from yourself! This ‘levy’ is going to raise the price of everything, as if anything in Barbados is cheap

    Reply
  2. Francis McClean
    Francis McClean July 12, 2017 at 3:16 am

    They intend to tax their way out of this mess. They have no other ways of raising revenue. It will not work. Transactions will decrease.
    He’s now justifying the need for more layoffs in advance. “talking bout hurt revenue target”. They are between a rock and a hard place because with elections looming, one more person sent home gine finish them all.

    Reply
  3. Kingdom Hearts
    Kingdom Hearts July 12, 2017 at 5:17 am

    Delay in elections hurting Barbados image and its people too but still yet you pack of clowns refusing to exit stage left.

    Reply
  4. Kym Reigns
    Kym Reigns July 12, 2017 at 5:28 am

    A delay in elections hurting we all. Hush yo tail Minister do!

    Reply
  5. Lilian Lloyd
    Lilian Lloyd July 12, 2017 at 5:37 am

    DONVILLE AND HIS PORKY PIG MENTALITY

    Reply
  6. Eddy Murray
    Eddy Murray July 12, 2017 at 6:06 am

    But! Mr. Inniss I thought that you said the FX taxes will hurt businesses, so I thought any delay you would have welcome.

    Reply
    • Dave D. Thompson
      Dave D. Thompson July 12, 2017 at 8:09 am

      Mr Innis talks out of both sides of his mouth …he was critical of these same measures …a real fraud

      Reply
  7. Sunil Brome
    Sunil Brome July 12, 2017 at 6:29 am

    The revenue target was never realistic in the first place.

    Reply
  8. Robert MacDonald July 12, 2017 at 7:28 am

    Barbados is not an inexpensive destination, particularly for Canadians who are dealing with a low dollar compared to the USD. I have been visiting for over 50 years, however this new tax along with others is going to raise the cost, to the point that I am considering changing my winter travel plans.

    Reply
  9. AniRo Burke
    AniRo Burke July 12, 2017 at 7:40 am

    Delay will hurt their personal pocket ya mean, hahahahaha

    Reply
  10. Lee Farnum-Badley July 12, 2017 at 7:48 am

    Robert MacDonald’s comment: “I am considering changing my winter travel plans” is the touchstone for the disaster that will befall Barbados. Every cent in tax revenue in Barbados has its origin in our ability to EARN foreign exchange. Our standard of living depends on what the island earns directly or indirectly from the tourist industry. There is no more sugar, and we are losing the revenue once brought by the International Business Companies as well. Get real: Stop pussy-footing around with 2% . . . . . . adjust the Barbados dollar properly NOW and let market forces stimulate revenues !!

    Reply
  11. Errol Rayside
    Errol Rayside July 12, 2017 at 8:17 am

    parasitic political class.

    Reply
  12. Sam Alleyne
    Sam Alleyne July 12, 2017 at 8:34 am

    Kingdom Hearts makes an excellent point, love it

    Reply
  13. Ali Baba
    Ali Baba July 12, 2017 at 8:51 am

    GREASY MOUTH CLOWNS, DEM IS

    Reply
  14. Hermine Alleyne July 12, 2017 at 8:55 am

    More taxes less spending how is that going to help??Mr.Innis’s,how do you all expect to get more from less please explain your Maths,If that is not crazy tald I don’t know what is.

    Reply
  15. BimJim July 12, 2017 at 10:04 am

    It’s YOUR revenue target, not ours.

    Reply
  16. Wendell Kirton
    Wendell Kirton July 12, 2017 at 10:58 am

    It’s true

    Reply
  17. Tedd July 12, 2017 at 10:59 am

    did he not vote in favour of these taxes, or am I mistaken?

    Reply
  18. Anderson Langdon
    Anderson Langdon July 12, 2017 at 12:04 pm

    Then why speak out against it at the Budget! Placing self before party and country will not end well!

    Reply
  19. Rubertha Blackman
    Rubertha Blackman July 12, 2017 at 3:03 pm

    Why don’t they sell their personal assets that came through the public coffers? Why are we seeing this man everyday? Does he think that we are not reminded that he is part of a fail administration? Why don’t you encourage de gorrilla-phants in your administration to call elections? Just why are you in the papers everyday, especially when you voted for budget that will cause untold harm to every sector of my beloved island?

    Reply
  20. Belfast July 12, 2017 at 8:56 pm

    Inniss’s is a case of Hunting with the hounds and running with the hare

    Reply
  21. Helicopter(8P) July 13, 2017 at 11:46 am

    “Self and party” are two words of the English language that are now defunct in Barbadian Nationalism. Conservatives are now tight lipped and Political parties are now scrutinized and picked apart. All candidates social and academic performances are up for investigation! No ones barred!

    Reply

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