Month: January 2013

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Judge Rejects SIPT

JUDGE REJECTS SIPT BID TO WITHHOLD PIPER’S PASSPORT AND PREVENT HIM FROM TRAVELING TO BRAZIL

McAllister “Piper” Hanchell
By Hayden Boyce
Publisher & Editor-in-Chief

A high court judge in Turks and Caicos Islands on Wednesday rejected an application by special prosecutors and investigators to prevent a former Cabinet minister from traveling to Brazil to visit former Premier Michael Misick in jail for his birthday.

Madame Justice Margaret Ramsay-Hale said she saw no reason for the Special Investigation and Prosecution Team (SIPT) to withhold the passport of McAllister “Piper” Hanchell, who will be traveling with a group from the Turks and Caicos Islands this weekend to visit Misick who turns 47 on February 2nd, and who is jail awaiting extradition to the TCI.

Hanchell’s lawyer Lara Maroof of F Chambers told the court that in keeping with bail conditions set by Chief Magistrate Clifton Warner, her client submitted his itinerary to SIPT on two previous occasions and was allowed to travel freely.

However, she said, when Hanchell sent an itinerary to travel to Brazil from January 31 to February 4th, his request was denied by SIPT who indicated in an affidavit filed in the Supreme Court that they felt that Hanchell was a flight risk and that he may even seek political asylum in Brazil and not return to the Turks and Caicos Islands.

SIPT also said they were concerned that if Hanchell was allowed to go to Brazil he would “collude” with Misick in discussing matters that are presently before the court.

Maroff, who revealed that Hanchell’s appointment to spend six hours with Misick in jail was already approved by the British Consulate in Brazil and prison authorities there, said it was “ridiculous” for SIPT to suggest that Hanchell would want to seek political asylum in Brazil, especially given what Misick is currently experiencing in that country after he was arrested there on December 7th.

Furthermore, she said, if Hanchell wanted to discuss any aspects of pending cases with Misick he could have done so on many occasions via telephone, Skype, email or other means before the former Premier was arrested.

Madame Justice Ramsay-Hale said she did not find any merit in the SIPT’s suggestion that Hanchell was a greater flight risk now than before, simply because he was going to visit Michael Misick.

She noted that he had travelled on two previous occasions and had returned and there was nothing to suggest that he would not return on this occasion. In addition, she said that the bail conditions that were originally set by Hanchell did not contain any non-contact clauses which would have prevented him from interacting with Misick.

“I just can’t see any reason to say no to allowing him to have his passport,” the judge said.

Judge Ramsay-Hale said that bail was set by the court and not by SIPT and that in the final analysis it was up to the court to decide whether bail should be varied and on what terms and conditions.
She said that SIPT does not have exclusive rights to come before the court to make representation for or against bail conditions, adding that this right also extends to defendants, but the court will have the final say.

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Extradition of Michael Misick

Official request made to Brazil for extradition of former Turks and Caicos premier
Published on January 30, 2013

By Caribbean News Now contributor

PROVIDENCIALES, Turks and Caicos Islands — A formal request for former premier Michael Misick’s extradition to the Turks and Caicos Islands (TCI) was lodged with the Brazilian government on Tuesday, said TCI attorney general Huw Shepheard.

According to Shepheard, the TCI’s chief magistrate and the acting attorney general formally certified the papers last week and they were taken to Brazil on Sunday.

“Some time was needed to assemble the documentation and to have the request translated into Portuguese; however, the request has been made well within the time limit imposed by the extradition treaty, in accordance with the intention of the TCI government and the special investigation prosecution team (SIPT) to secure Michael Misick’s return to the TCI by due process of law,” he said.

Following his arrest in Rio de Janeiro in December last year, Misick has been held in custody by authorities in Brazil pending the outcome of the extradition request by Britain to return him to the TCI for questioning in connection with allegations of malfeasance while in office.

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SIPT AND SANDALS REACHED SETTLEMENT ABOUT $ 12 MILLION

SIPT And Sandals reached $12 Million agreement
Published in TCI Post on 23t of January

SIPT RECOVERS A FURTHER $12M
The Special Investigation Prosecution Team (SIPT) and the Turks and Caicos Islands Government (TCIG) have reached an agreement with Sandals and its directors and officers in respect of the SIPT investigations.
This agreement is without any admission of liability by the company, its directors and/or officers. It does not however prevent the prosecution of any other persons in respect of any facts and matters.
The agreement, which involves a payment of USD$12 million to TCIG, is due in part to the co-operation of the company with the United States authorities to a degree that has been acknowledged to be both extraordinary and unique and included the early and voluntary release of valuable evidence that has been shared with the SIPT. That information has materially assisted SIPT’s investigations.

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Response To The Statement by Lillian Misick regarding VAT.

Response to the dishonest statement on VAT made by Lillian Misick
By John Glasgow TCI Post

In asserting her authority to speak on issues surrounding the implementation of VAT, Lillian Misick the former Chair of the illegitimate Consultative Forum asserts that the fact that she was the Chair of the Forum at the time the VAT Law was passed, gives her standing to speak on matters relating to VAT.
I may be wrong but it appears that Lillian is implying that others who have spoken and are speaking about VAT have no legitimacy to speak on the issue. The truth is that, every Turks and Caicos Islander and every business owner have legitimacy to speak on the issue of VAT since it affects all of us. However being a member or Chair of the illegitimate Consultative Forum does not give Lillian any special expertise to speak on VAT.
Lillian went on to criticize the political parties especially the PNP for not working with the Consultative Forum.
I am amazed that an obviously intelligent woman refused to accept that political parties have the right to make policy decisions and to follow through on those decisions. The PNP position at the time was that Direction Rule was illegitimate and tantamount to the British using a sledge hammer to kill a fly. Therefore any creature of the illegal occupation/Direct rule also lacked legitimacy. Since the Consultative Forum was a creature of Direct Rule…the FCO and Governor. It followed that the PNP could not have accepted its legitimacy while vehemently opposed to the illegal occupation of the TCI.
I agreed with the PNP’s position at the time. The Consultative Forum was a trojan horse used by the British to legitimize Direct rule and to put a democratic and transparent face on 21st century colonialism and modern day slavery.
During the life of the Consultative Forum it became clear that the British attached no great weight nor had any respect for the Consultative Forum. It was a creature of convenience. Lillian herself is on record of lamenting the lack of authority of the Consultative Forum and the shabby way in which it was treated by the British and their cadre of misfits bureaucrats.
Therefore none of the political parties were under any obligation to negotiate or work with a Creature which came out of the wombs of colonialism and which lacked a democratic mandate to act for Turks and Caicos Islanders.
Lillian went on to assert that while the PNP is on record of opposing VAT from the outset, the PDM only opposed VAT weeks before the general elections. I am sure that this is not an accurate statement because the PDM did oppose the implementation of VAT very early in the VAT debate.
It is beyond me why Lillian Misick would outright lie on the PDM and misrepresent its position on VAT to the public!!!!
In her statement she asserts that there were wide consultation on VAT but made no mention of the outcome of the consultations. VAT was rejected by the majority of Turks and Caicos Islanders. Funny Lillian forgot to mention that….
She went on to say the following:
To be fair and, more importantly, to keep our people properly informed, it is imperative to bear these facts in mind when discussing, and reporting on, VAT.
That said, let me assert for the record that I believe VAT is the best system of taxation for the TCI. Moreover, nobody can deny that that our current system – with its exemptions and loopholes that favor the rich – imposes an unfair and unsustainable burden on poor and middle-class TCIslanders.
Readers, the above statement by Lillian shows that she does not understand the fundamentals of VAT neither does she understand the arguments put forward by the overwhelming majority of Turks and Caicos Islanders who oppose VAT.
I may be wrong and I pray that someone corrects me if I am but VAT is a Consumer Tax which affects the end user. Therefore its effects on the poor is more devastating than on the rich. A few exemptions on low end consumer goods cannot adequately mitigate the negative effects of VAT on the poor.
Another fundamental point missed by Lillian is that businesses at the end of the day will be able to reclaim their VAT expenses while the poor would not be able to do so.
Secondly if the Implementation of VAT is designed to deal with the loopholes in the current tax system which favours the rich….(Lillian words not mine). Then why not just enact legislation to close those loopholes and dispense with those exemptions favouring the rich?
The above statement by Lillian Misick in my opinion is an attempt to bolster the argument made my the CFO at the VAT consultation meeting in Providenciales where he accused business owners of opposing VAT because they wanted to use their business to fund their lifestyles.
Lillian Misick further accused the PNP of having no alternative to VAT. Did she missed that the Premier asked the FCO for a six months delay in the implementation of VAT while they consult as a government on the best tax system for the TCI. It is now a matter of public record that the Overseas Territories Minister Mark Simmonds refused to grant the Premier’s request.
It appears that the former Interim regime has no rational reason to implement VAT. Both the PNP and PDM opposed VAT, it appears that Lillian who is the governor’s appointed member in the House Of Assembly is the lone Voice in Parliament Supporting VAT.
Of course the Former interim regime has to save face and implement VAT in light of the Governor’s ill advised public statements, where he told the media that no elected government can prevent the implementation of VAT. Therefore this has a lot to do about ego and little to do about sound financial judgement.
Probably the following is the most puzzling statement from Lillian Misick:
”I note, for example, that finance minister Hon. Washington Misick has been quoted saying that VAT “is being forced down our throats” (CNN, 17 January 2013); whereas the uncontroverted facts delineated above make clear that nothing could be further from the truth”.
Did Lillian missed it that no one at the consultations and in the business community supported VAT?? The consultations were a farce. The fact that the former interim regime decided to press ahead with VAT in the face of overwhelming public opposition speaks for itself.
Washington Misick is absolutely right, VAT was forced down the throats of the people of the TCI.
I disagree with Lillian Misick that VAT is the best tax system out there and because everyone else is doing it we should implement it also. The former interim regime has not convinced anyone on this issue….
Lillian has added absolutely nothing to the debate on VAT. In fact by inserting herself in the VAT debate, it is possible that more people will oppose VAT.
Lillian went on to attack the PNP on its pro independence stance. This will be dealt with in another article. If Lillian was appointed as the former interim regime spokesperson on this issue. She has done nothing so far to advance the British case for the implementation of VAT. John Glasgow

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Open Letter From Former Premier of Turks and Caicos Michael Misick

Open Letter From Michael Misick Former Premier Of the TCI To Helen Garlick

Michael Misick
Rio de Janero

Helen Garlick
SIPT
Providenciales
Turks and Caicos Islands
RE: Open Letter Regarding my voluntary return to my country Turks and Caicos Islands
Dear Ms Garlick
I am disappointed by your response to my verbal request and written request to voluntarily return home to answer question or any future charges that you may levy against me. I am determined to clear my name in relation to the allegations made by you towards me.
In response to my request to voluntarily return home directly on a charter flight, paid for by my family, your excuse is that I may change my mind between the prison and the airport and refuse to board the plane or (during) my stop-over in the British Virgin Islands I may decide to stay there.
This is the lamest excuse I have ever heard a law enforcement professional use to someone who is on the Interpol Red Alert and wanted in a jurisdiction for question and want to voluntarily surrender.
I must remind you that I am a 47 year old man (who) has spent 20 distinguished years in politics and dedicated service to my country Turks and Caicos Islands. In addition to having the honor of being the country’s first premiere, I have served in many different capacities as Minister (of Government) over the past 20 years. It is known that I did not at any time abscond or run away from the Turks and Caicos Islands or any charges. The fact is that I was away from home almost two (2) years when the arrest warrant was issued for me. It is also a known fact that because of the changes in the constitution, like removing the right to persons accused to a trial by jury, changes to various laws of evidence including the hearsay view, I am of the firm view it was and is not possible to get a fair trial for me and my colleagues.
It is a known fact that I while in office along with my colleagues advocate independence from Britain for our country Turks and Caicos Islands and it is my belief that this entire investigation, charges and pending charges is politically motivated and that we are being prosecuted because of our political views. As a result of the above position, it was also a known fact that I had applied for political asylum in a third country because of the political prosecution stated above and the violation of my human rights.
I have decided that in spite of my firm belief that I cannot get a fair trial, nor can my colleagues, and in spite of my political prosecution because of our belief that the Turks and Caicos should be independent and Turks and Caicos Islanders should be running every aspect of government, to voluntarily return home.
As a former Premiere and a leader in my country, I have not made that decision lightly. Therefore I could (not) and never will change my mind enroot to Turks and Caicos Islands. I therefore pledge to you and most importantly to the people of the Turks and Caicos Islands (that) if you withdraw the prison order and lift the Red Alert so that I can travel, my family will provide a plane for my return home, Officers from the Royal Turks and Caicos Islands Police force and/or Interpol can also accompany me on that direct flight to the Turks and Caicos Islands.
My word is my honor and at this stage all I have left is my word.
I (have) already spent six (6) weeks in prison in Brazil with no effort on your part, (no effort) on Turks and Caicos Government part, and (no effort) on the British part to have my safe return. If you are serious about even the appearance of Justice and not revenge and prosecution I ask that you in good faith re-consider your decision to reject my voluntary return. I again state that there is no need for a long and expensive process of extradition as I am willing to return voluntarily within 24 to 48 hrs of your agreement to have me return voluntarily.
The power is in your hands to do what is right and decent.
My trust as always is in my God.
Michael Misick
Former Premiere
of Turks and Caicos Islands
from Prison in Rio de Janero
BRAZIL

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Another Voıce about VAT By Hon.Lillian Misick

Statement on VAT by Hon. Lillian Misick

I served as Chair of the Consultative Forum during the public consultation process and legislative enactment phase for the implementation VAT in the TCI. Therefore I am very familiar with the procedural and substantive issues involved.
This gives me standing to assert the following without fear of any (fact-based) contradiction:
· VAT was the subject of thorough study and vigorous public debate for almost two years (beginning March 2011).
· With the UK publication of a Green Paper in April 2012 and a White Paper in July 2012, local political and business leaders, as well as ordinary residents, were given more than enough opportunity and time to express their views and concerns.
· Between 11 May and 7 June 2012 British officials conducted “a series of public meetings for people to learn more about value-added taxes expected to begin April 1, 2013” (Free Press, Thursday 10 May 2012).
· Business leaders (predominantly expatriate) expressed visceral opposition to VAT from the outset and executed a vigilant anti-VAT campaign throughout.
· The PNP are on record opposing VAT as early as July 2012. British authorities have been exhorting them since then to produce a viable alternative. PNP leaders have yet to do so….
· “Acting Gov. Patrick Boyle signed value-added taxes into law July 19, accepting several suggestions from the Consultative Forum and pledging to make more changes before VAT is implemented in the Turks and Caicos Islands on April 1.” (Free Press, 19 July 2012)
· The PDM are not on record opposing it until just weeks before the November elections.
To be fair and, more importantly, to keep our people properly informed, it is imperative to bear these facts in mind when discussing, and reporting on, VAT.
That said, let me assert for the record that I believe VAT is the best system of taxation for the TCI. Moreover, nobody can deny that that our current system – with its exemptions and loopholes that favor the rich – imposes an unfair and unsustainable burden on poor and middle-class TCIslanders.
But, like legislators of good faith in any Commonwealth country, I relied on the findings in thoroughly researched Green and White Papers in voting for VAT. I was also persuaded by the fact that several countries in our region, including Jamaica, Barbados and Antigua, established long ago that VAT is the most equitable, efficient and economically viable system of taxation for them.
By contrast, I remain stupefied by the failure of those opposing VAT to accept the UK government’s entreaty to come up with a fairer and more sustainable system of taxation. And since they will have had over two years to do so, their requests for a delay in the April 2013 implementation of VAT smacks of irresponsible contrivance not worthy of comment.
Nonetheless, I was bemused by the report in your lead article yesterday that “the fight against the imposition of value added tax (VAT) in the Turks and Caicos Islands (TCI) has now produced an unusual bipartisan unified front by the government and the opposition”.
After all, this is even more plainly futile than the UK and Denmark forming a unified front to fight against the implementation of the euro. Not to mention that this opposition against the implementation of VAT strikes me as just more of the same feckless defiance that characterized opposition to the suspension of our Constitution.
But surely our leaders should have learnt by now that merely hurling neo-colonial epithets at the British does not constitute effective local leadership. (Like President Obama said yesterday in his second inauguraladdress “we cannot … treat name calling as reasoned debate”.) More to the point, their antic disposition will do little to build the partnership with the UK that is so indispensable to our political viability and economic solvency.
As a case in point, I entreated local political leaders throughout the three-year interim period to work with us in the Consultative Forum to enhance our leverage in negotiations with the British. But instead of doing so they wallowed in some parallel universe where they felt it was more effective to dismiss the Forum as illegitimate and those serving in it as traitors.
This gave rise to their impudent pledges to repeal laws the Forum duly enacted. Indeed, the irony is that, where our Constitution granted the British the authority do everything they have done in the TCI, it does not grant our local leaders the authority to repeal or nullify anything. Alas, this irony seems completely lost on them.
Which brings me to my final, and perhaps most salient, comment:
As much as I sympathize with the frustrations and feelings of inefficacy amongst local leaders, I fear that they have not served our people well by continually vacillating between defiance and victimhood in their dealings with the British.
I note, for example, that finance minister Hon. Washington Misick has been quoted saying that VAT “is being forced down our throats” (CNN, 17 January 2013); whereas the uncontroverted facts delineated above make clear that nothing could be further from the truth.
By contrast I can cite numerous occasions when, in lobbying our British Governor and the head of all Overseas Territories to further the interests of TCIslanders, I had just cause to criticize the UK government. They never failed to accept my criticisms in a spirit of collegiality and, on more than a few occasions, made concessions pursuant to them.
Frankly, our local leaders are going to have to come to terms with the fact that we are still a UK Overseas Territory. Otherwise, their administrative impotence will be surpassed only by their political incompetence.
Apropos of this, I am acutely mindful that the PNP ran on a platform of independence. Therefore, it is stupefying that, instead of engaging the British to chart the course towards TCI independence, PNP leaders (often in concert with opposition PDM leaders) have done little more than complain about the way the British are exercising the authority duly vested in them by our Constitution.
Incidentally, like the enlightened people of Bermuda, I believe TCIslanders have far more to lose by becoming independent than we have to gain.
But it reeks of hypocrisy and cowardliness for local officials to continue mouthing rhetoric about independence without taking any steps towards it. Especially since they know full well that, far from standing in their way, the UK would be all too happy to cut the colonial chord of obligation that makes it, in effect, the parent of now notoriously unruly and ungrateful children.
In the meantime the only way our local leaders will earn the respect they clearly covet is if they begin showing more respect for the constitutional authority the British have to ensure good governance and sound management of our public finances.
They should beware, though, that if they push for independence, they might end up leading a parade with no one marching behind them.

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Political Unity in Turks and Caicos Islands

New tax creates political unity in Turks and Caicos
Published on January 21, 2013

By Caribbean News Now contributor

PROVIDENCIALES, Turks and Caicos Islands — The fight against the imposition of value added tax (VAT) in the Turks and Caicos Islands (TCI) has now produced an unusual bipartisan unified front by the government and the opposition.

While government supporters, including former Progressive National Party (PNP) candidate Royal Robinson, have gone public with an appeal for unity against Britain’s Foreign and Commonwealth Office (FCO), which promoted the VAT legislation in the first place and has since rejected requests for a delay in its imposition, resistance to VAT had not so far generated any political unity.

All this changed on Saturday, when Premier Rufus Ewing invited Peoples Democratic Movement (PDM) opposition leader Sharlene Cartwright Robinson to join in a press conference on the issue of VAT. While both parties both oppose VAT, this is where they begin and end on the matter, however.

VAT is the means implemented by the former interim government last year to raise taxes to pay down the $260 million loan guaranteed by Britain. In fact, this was restated in last Monday’s Appropriations Committee meeting by chief financial officer Hugh McGarel Groves. It was also repeated in a letter sent last Monday to Ewing from Mark Simmonds, Britain’s minister for the Overseas Territories, who rejected a request for a delay in the imposition of VAT in the TCI and confirmed that the new tax will take effect as planned on April 1, absent a credible alternative.

The PNP government feels that VAT is not enough and has complained strongly that it is not a democratically imposed tax. However, the government wants to impose other taxes, which will raise what it estimates to be 150 percent more tax revenue. In fact, finance minister Washington Misick has said his suggested taxes will “improve the economy of the Turks and Caicos Islands”. What it appears he meant was that such new taxes will improve the income of the government not the economy itself.

The opposition PDM, while against the imposition of VAT, has not suggested any new taxes. The party has issued a position paper on the issue, which states that the fundamental budget problem is failure to collect all the current taxes due and the extraordinarily high cost of health care.

PDM leader Cartwright Robinson said at an earlier press conference that there has been no work by the PNP government on reforming the NHIP health plan.

Cartwright Robinson said that her party was opposed to VAT primarily because it will raise the cost of living.

“When you change the basic tax structure of an entire country, the elected government representing the people needs to make that decision,” said Cartwright Robinson

Following the election of the PNP as the new government last November, Ewing and his finance minister Washington Misick have been seeking a delay of six months in the implementation of VAT.

However, according to overseas territories minister Simmonds, a delay in the implementation of VAT would present significant risks.

“A delay at this stage would risk undermining the credibility of the government’s commitment to VAT particularly with those businesses that have invested in preparation. And I am not convinced that delay would make it easier for you to find and commit to the introduction of a credible alternative. I fear that a property or income tax would be likely to attract opposition at least as strong as VAT,” he said.

Simmonds went on to say that any such delay would be unlikely to diminish the opposition of those businesses who will have to pay tax for the first time or open their books or lose some of the benefits of what he described as “excessive concessions” granted by previous administrations.

He also pointed out that delaying the implementation of VAT would require the government to cut public spending further than would otherwise be necessary.

“I think you have a choice between pressing ahead with the introduction of VAT from 1 April or making a clear commitment to introducing a credible alternative to VAT such as property or income tax. I should be clear that I believe that, at this stage, the best option for Turks and Caicos is to press ahead with implementation of VAT,” Simmonds said.

Tinkering with the current disparate and unsatisfactory mix of taxes would not address the underlying weakness and unfairness of these and would not offer a credible alternative to VAT, he added.

According to SImmonds, the previous elected PNP government had already decided that VAT had significant advantages over property and income taxes but, nevertheless, invited Ewing to submit a new fiscal and strategic policy statement by the end of January.

“While you are finalising this I expect preparations for VAT implementation to continue at full speed, including investment in planned new IT, so that it can take effect on 1 April,” Simmonds added.

However, Simmonds’ claim that the previous PNP government had endorsed VAT was disputed in a subsequent statement by then finance minister, Floyd Hall.

“That statement is completely false. While it is the case that the former PNP had agreed to explore the option of selecting one of four taxation models being imposed on us by advocates for the Organization for Economic Corporation and Development (OECD), the European Union, IMF and the FCO to obtain compliance with international tax standards in our financial services industry and to achieve revenue sustainability, it was never the case where VAT was selected as a done deal for implementation in the Turks and Caicos Islands by our PNP administration,” Hall said.

The new tax was signed into law during the term of the previous interim administration run by Britain following the suspension of elected ministerial government in the TCI in 2009 as a result of widespread and systemic government corruption during the PNP’s previous term in office from 2003 to 2009.

Unrestrained government spending during those years brought the TCI to the verge of bankruptcy, necessitating a $260 million loan guaranteed by Britain and other measures to enable the territory to balance its budget.

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British insists on imposition of VAT in Turks and Caicos Islands

Britain insists on imposition of VAT in Turks and Caicos
Published on January 17, 2013

By Caribbean News Now contributor

PROVIDENCIALES, Turks and Caicos Islands — In a letter on Monday to Dr Rufus Ewing, premier of the Turks and Caicos Islands (TCI), Mark Simmonds, Britain’s minister for the Overseas Territories rejected a request for a delay in the imposition of value added tax (VAT) in the TCI and confirmed that the new tax will take effect as planned on April 1, absent a credible alternative.

Following the election of the Progressive National Party (PNP) as the new government last November, Ewing and his finance minister Washington Misick have been seeking a delay of six months in the implementation of the tax.

However, according to Simmonds, a delay in the implementation of VAT would present significant risks.

Britain’s minister for the Overseas Territories, Mark Simmonds
“A delay at this stage would risk undermining the credibility of the government’s commitment to VAT particularly with those businesses that have invested in preparation. And I am not convinced that delay would make it easier for you to find and commit to the introduction of a credible alternative. I fear that a property or income tax would be likely to attract opposition at least as strong as VAT,” he said.

Simmonds went on to say that any such delay would be unlikely to diminish the opposition of those businesses who will have to pay tax for the first time or open their books or lose some of the benefits of what he described as “excessive concessions” granted by previous administrations.

He also pointed out that delaying the implementation of VAT would require the government to cut public spending further than would otherwise be necessary.

“I think you have a choice between pressing ahead with the introduction of VAT from 1 April or making a clear commitment to introducing a credible alternative to VAT such as property or income tax. I should be clear that I believe that, at this stage, the best option for Turks and Caicos is to press ahead with implementation of VAT,” Simmonds said.

Tinkering with the current disparate and unsatisfactory mix of taxes would not address the underlying weakness and unfairness of these and would not offer a credible alternative to VAT, he added.

According to SImmonds, the previous elected PNP government had already decided that VAT had significant advantages over property and income taxes but, nevertheless, invited Ewing to submit a new fiscal and strategic policy statement by the end of January.

“While you are finalising this I expect preparations for VAT implementation to continue at full speed, including investment in planned new IT, so that it can take effect on 1 April,” Simmonds added.

However, Simmonds’ claim that the previous PNP government had endorsed VAT was disputed in a subsequent statement by then finance minister, Floyd Hall.

“That statement is completely false. While it is the case that the former PNP had agreed to explore the option of selecting one of four taxation models being imposed on us by advocates for the Organization for Economic Corporation and Development (OECD), the European Union, IMF and the FCO to obtain compliance with international tax standards in our financial services industry and to achieve revenue sustainability, it was never the case where VAT was selected as a done deal for implementation in the Turks and Caicos Islands by our PNP administration,” Hall said.

The new tax was signed into law during the term of the previous interim administration run by Britain following the suspension of elected ministerial government in the TCI in 2009 as a result of widespread and systemic government corruption during the PNP’s previous term in office from 2003 to 2009.

Unrestrained government spending during those years brought the TCI to the verge of bankruptcy, necessitating a $260 million loan guaranteed by Britain and other measures to enable the territory to balance its budget.

According to the former chief financial officer Hugh McGarel Groves, VAT will be necessary for as long as Britain’s loan guarantee remains in force.

At a press conference on Tuesday, finance minister Washington Misick spoke out again against VAT.

“This is being forced down our throats,” he said. “They are committed to VAT having bought a half-million dollar software program to deal with VAT… this shows that the VAT tax is a issue of their egos making them act.”

While saying initially that he could not reveal the alternative methods of taxation to VAT that his government is considering, Misick then proceeded to reveal them on Tuesday, namely, taxes to be assessed on condominium owners who rent their properties to non owners; a 1 percent increase in the hospitality tax from 11 to 12 percent; a restoration of the higher rate of stamp duty; and a tax on water sports activity by tourists in the TCI, both in Provo and Grand Turk.

Misick estimates this will raise between $15 and $16 million per year and grow the economy of the country.

However, according to some local observers, such measures may increase government revenue but is more likely to be counterproductive to the economy.

Opposition leader Sharlene Cartwright Robinson said in a Tuesday afternoon television appearance that the opposition Peoples Democratic Movement (PDM) continues its position that it also does not favour VAT.

Robinson was not in favour of alternate taxes, however.

“We simply need to police the collection of existing taxes,” she said.

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VAT Discussions in Turks and Caicos.PNP Government against VAT

FORMER PNP GOVERNMENT WAS NEVER IN SUPPORT OF VAT

By Floyd Hall – Former Minister of Finance
Published in SUN TCI

It is most gratifying to see that the two political parties and the business community have finally gotten together to unify around a common cause in the best interest of the people of the Turks & Caicos Islands.

Sadly though, it seems as if it has taken the British Governor and the FCO stepping on the toes of some people or some groups directly before they could appreciate the gross injustice that has been meted out on this beautiful country before unified action is taken. Having said that, it is a good thing that we have achieved some modicum of cohesion, even if this may only be for the benefit of some business owners’ personal self-interest.

However, I wish to address a point that is dear to me and my former colleagues in that the former PNP administration is being misrepresented by Neil Smith in the Governor’s Office as it relates to his comments on VAT.

In Mr. Smith’s statement to the press on 15 January 2013 addressing the implementation of VAT, he stated that the former PNP Government was in support of VAT. That statement is completely false.

While it is the case that the former PNP had agreed to explore the option of selecting one of four taxation models being imposed on us by advocates for the Organization for Economic Corporation and Development (OECD), the European Union, IMF and the FCO to obtain compliance with international tax standards in our Financial Services Industry and to achieve revenue sustainability, it was never the case where VAT was selected as a done deal for implementation in the Turks & Caicos Islands by our PNP administration.

For Neil Smith to suggest that the noble intentions by our government to search for sustainable revenue streams for our country as an endorsement of VAT is grossly misleading and is typical of how the Governor’s Office has been conducting the affairs of this country for the last three years.

It was in my budget address of 2007 when I first informed the people of the Turks & Caicos Islands about comprehensive revenue reform for our country. A direct quote from that address follows:

“While recent revenue growth has been positive, it is concentrated in a few areas. We need to lessen our dependence on import duties as global tariffs reduction become more commonplace. If we do not do likewise, our competitiveness in attracting foreign investment could be eroded. The current tax regime also needs to be widened if we are to raise the necessary revenue on a sustainable basis to implement our plans. We also need to have a tax regime, which incentivizes positive behaviours and penalizes negative ones. Mr. Speaker, these objectives can be achieved through the introduction of alternative broad based taxes that are elastic, and the introduction of user charges where they can serve to defray costs. The time to act is now – we plan to consider all options.

In this regard, Mr. Speaker, I led a delegation to the Bahamas last week to discuss their revenue regime and strategies, and develop technical cooperation and exchanges in this area. We have already held discussions with the Caribbean Area Regional Technical Assistance Centre (CARTAC) concerning technical assistance to prepare a Tax Policy Study for consideration by government. This study would look at our economic structures, tax regime and recommend reforms to increase revenue yield on a sustainable basis. We are committed to this worthy task. I look forward to keeping this Honourable House and the nation informed of activities in this area.”

I later made a follow up reference to broadening our revenue base in the 2008 budget but never did I offer support for VAT or any other comprehensive tax mechanism. Unfortunately the study referenced to in the 2007 address never materialized as the country was hit by two successive hurricanes in 2008 causing extensive damage throughout the country and the global financial collapse that immediately followed in 2009 made the exercise untenable.

Our administration back in 2007 was asked to consider four different models: income tax, property tax, sales tax and VAT.

Preliminary indications from the business sector at the time suggested that the real estate and hotel industries had no appetite at all for income tax or property tax. It was believed that the real estate market was just getting its legs firmly established and that any form of taxes on income or property would be a serious deterrent to investment and would derail the real estate sector. The sales tax and VAT likewise had vociferous opposition to them albeit less so than the others but never was there any decision nor was there any canvassing of support for one tax over the other by the former PNP administration.

To the best of my knowledge, the deliberate promotion of VAT was only done when the hand-picked members of the Advisory Council and Consultative Forum ill-advisedly passed legislation implementing VAT, Trials With-out Jury, and Hearsay Evidence legislation. My recollection at the time was that there was a public outcry against all three pieces of legislation. The radio talk shows vented the opposition of the people to these Bills and so did the print and televised media.

Ironically some of the very same people who were a part of these hand-picked bodies gave credibility to the same pieces of legislation that they are now vehemently against. Similarly, the very same Governor’s office who seeks to castigate and vilify the former PNP administration at every opportunity it gets now seeks to use this same administration to fortify its promotion of VAT.

There is a popular saying that I believe resonates universally which states “you cannot have your cake and eat it too”. I think this saying applies aptly to the Governor’s Office promotion of VAT as well as those who now oppose it and gave validity to its imminent implementation. I know some will be quick to say that they opposed those pieces of legislation when they sat on those bodies. To that I will use the other popular maxim which states “the devil is in the details”.

However, I believe that the entire country is relieved that the voices that seem to matter are speaking out in unison regardless of the channels that may have brought them to this central point. To that I say thank you to all and sundry as I do wish you success in this worthy undertaking to begin the New Year.

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Time for the Governor ,Deputy Governor to start respecting Premier in TCI

Published in TCI Post

Readers may remember that late last year at the 2nd sitting of the House of Assembly, the Premier made a Ministerial Statement in Parliament. The following is an excerpt from that statement:
Mr. Speaker, as Premier, I am responsible for the conduct of business in all ministries, along with the holders of the ministerial portfolios, so I will not go deep into the business of those ministries. Mr. Speaker, I assumed responsibility for Investment and Trade as I saw the need to boost inward invest in this country. Mr. Speaker, I must state clearly that the Inward Investment Unit cannot function maximally under the Deputy Governor’s Office and with the current structure. Therefore Mr. Speaker, it is my Government’s intention to transfer the Investment Unit to the Ministry of Finance and the development of a new statutory body with similar functions to TCInvest to replace the Investment Unit in short order. I will allow the Hon. Minister of Finance to expound on this further.
Mr. Speaker, during the period of the Interim Administration, the Spokesperson for the Governor’s Office was also in charge of the TCIG’s Press Office. Mr. Speaker, after we were elected as the Government, there is a clear reluctance to relinquish control of the Press Office, which is still under the Deputy Governor’s Office. Mr. Speaker, come January morning the TCIG’s Press Office will be transferred to the office of the Premier with increased staffing and no interference. End
In response to that section of the Ministerial statement, it was brought to my attention that the Deputy Governor said that the Premier is a Minister without portfolio and cannot make such decisions and as a result the press office and the Investment Unit will be staying where they are. The Investment unit is operated from the Deputy Governor’s Office and the governor is refusing to relinquish control of the government’s press office.
The letter from the Deputy Attorney General Rhondalee Braithwaite informing investors that the Premier has no authority to deal with any investment in the TCI confirms that the Governor , the Deputy Governor and British Officials have no respect for the Premier or his office or for the will of the voters of the TCI. Rhondalee had to get permission from someone high up in the former interim regime in order to write such a letter.
The Press Secretary Zadie Neufville who is a Jamaican refused to take any instructions from the Premier and does not speak to him. Imagine an expat paid by our tax dollars disrespecting our elected Premier.
The governor and the Deputy Governor has created an atmosphere where expat civil servants will soon show the Honourable Premier their Middle Finger.
The Governor’s Parrot oops press Secretary Neil Smith still follows the elected government around even though he is not wanted and the government press secretary Zadie Neufville only take instructions from Neil Smith.
To add insult to injury the Governor and the Deputy Governor are demanding that the Premier must get approval from them first before he can hold a press conference and they want to know before hand what he is going to say. This is disrespect to the highest. When is it going to stop????

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