Couva/Pt Lisas Chamber: We’ll have no choice but to increase prices
Head of the Couva/Pt Lisas Business Chamber of Industry and Commerce, Liaquat Ali, says the 2018 Budget is a blow to small businesses and consumers, who will be forced to raise prices in order to stay afloat.
Speaking with LoopTT, Ali said the price of diesel, which increased from $2.30 to $3.41 per litre, will not only harm small businesses but will cause more hardship for consumers.
“The price of goods will increase; we as a business community absorbed fuel increases from previous years to keep some of the costs down, but this increase is definitely going to make an impact.”
Ali criticised the country’s deficit increase which ballooned from an anticipated $5,873.8 million to $12,643.5 million.
“Based on the deficit which increased to $12 million it demonstrated to me the inability of government to collect their taxes, and because of this inability, the business community is always called upon to pay the price.”
He said the increase corporation tax, which was increased to 30 percent, can possibly damage small businesses.
“We have had several rising costs in recent years, including the business levy and green fund, and now the increase in Corporation Tax to 30 percent. If you want small businesses to expand, I think Corporation Tax is not the way to go; in fact you should lower taxes if you want to stimulate the local private sector.”
Ali also expressed concern at the increase in Corporation Tax for commercial banks to 35 percent.
“We hope that the banks, in order to maintain their margins of profit, don’t increase bank charges for the consumer. We were hoping that we would have seen a regulated system in terms of what banks would charge the consumer, rather than increasing corporation taxes, so that the consumer would benefit,” he said.
He said that these taxes, as well as the price of fuel, may do more harm to the agricultural sector.
“The price of fuel will affect the agricultural sector. This will have a negative impact on the cost of goods and services across the board. Agriculture also received a reduction in their budget. Every stakeholder is talking about agriculture and creating exports, but diesel is a major factor for the agriculture sector, and this will send up the cost of production even higher,” he said.
Ali said he would have preferred to see an increase on taxes for alcohol and tobacco, which he says are not necessities and are also imported items.
“I would have preferred to see taxes on alcohol and tobacco because you don’t have to pay for that,” he said.
Ali also agreed with plans to finally open the Couva hospital, which government says will cost around $400 million in operating expenses.
"We are happy to know that the Couva hospital will be opened, that is a welcome point from Government," he said.
Ali also expressed agreement with incentives to upgrade and develop Tobago’s tourism sector after Government announced that under the Trinidad and Tobago Hotel and Guest Room Stock Upgrade programme, owners will now receive reimbursements on expenditure of up to 50 percent, with a maximum reimbursement limit from $750,000 to $1.5 million.
He also approved of government's initiative to allocate foreign exchange to exporters through the ExIm Bank. The facility would be capitalised at US$100 million and will be available to exporters who produce at least 30 percent of their products for export.
Ali added the issue of crime for the Couva/Pt Lisas area remains critical and said that new measures are needed.
“I was expecting more detail and look forward to more information in terms of fighting crime,” he said.
Overall, Ali said that he expected a tough budget, and said businesses will do what they can to weather the changes.
“We recognise the fact that government has to take revenue; we anticipated a tough budget, and we got a tough budget," he said.