Council gives green light to repeal obsolete laws

PHILIPSBURG–The Council of Ministers on Tuesday gave the green light to repeal several laws, some of which are seldom used and others which are no longer applicable.

Now that the Council has taken a decision, the matter has to go through the Council of Advice then to Parliament, which will make the final decision before the laws are officially struck off the books.

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Finance Minister Richard Gibson told reporters during the weekly Council of Ministers press briefing on Wednesday that the laws identified for repeal are those that are hardly used and those that no longer serve the best interest of St. Maarten. Some are also laws that Parliament had indicated should also be struck off the books.

He described the decision of the Council as the start of the process of “cleaning up the clutter” in the country’s tax system. “By cleaning up the clutter, new legislation will not be impaired by the existence of clutter and the clutter are tax laws that existed before St. Maarten became a country [in the Dutch Kingdom – Ed.] and in the process of reform [we are – Ed.] trying to get rid of those laws so that they do not conflict with new legislation that are coming,” Gibson said.

Identified to be repealed are the Succession Law, which Gibson said Parliament had indicated should be struck off the books on March 22, 2012, and the Property Tax Laws as well as the surcharge that accompanies this tax. Gibson said the property tax law was not implemented in St. Maarten for many years, though it is in effect in Curaçao. “Curaçao has property tax and we don’t. That is cluttering too and part of the decision was to put in the pipeline a decision to repeal property taxes for St. Maarten.”

Also to be taken off the books is the Dividend Tax, which Gibson said “has not been producing anything.” The law on Economic Zones, also set to be repealed, has been on the books for many years. This required that an area be designated to be an Economic Zone. This, however, never materialised and according to Gibson it “no longer fits the time that we are in.”

Also to be repealed is the hotel and industry tax facility. Gibson said experts have determined that in almost in all cases, hotels first establish themselves based on information that they can generate an income to make it a success, but only several years after establishing and hearing about the law, do they file for this tax facility. He said also that the procedures are “very encumbering. The proposal is to take it off the books. Those tax facilities would no longer be offered as well as tax facilities for the development of land. I don’t think anyone needs a tax facility to develop land.”

The minister said government is in the process of reforming the tax system with the aim of simplifying it and to, as much as possible, shift from direct to indirect taxes and to stabilise government revenues at a level that will allow government to meet its obligations to the public. “Now revenues are at a level that it is insufficient to meet all of the obligations that government has and to maintain a balanced budget. Reforming the tax system is complicated and is quite a challenge. The reforming project is being tackled in segments,” Gibson said.

Source: The Daily Herald