Maroc - NEWSDAY.CO.TT - A la Une - 27/Jan 03:29

Finance Minister: VAT refunds in cash by this week

FINANCE Minister Colm Imbert assured VAT refunds, amounting to close to $1 billion in cash, to small and medium-sized enterprises will be completed by the end of the week. In a post on X (formerly Twitter) on January 26. Imbert said, “Up to January 24, we printed 6,767 cheques, totalling $558 million,” he said. “By the end of next week, VAT refunds in cash for January 2025 will be close to $1 billion. “Next week, we are initiating the process to issue VAT bonds totalling $3 billion with more VAT refunds in cash to come.” During his 2024/2025 budget presentation, Imbert said VAT refunds were expected at the end of 2024. After complaints from businesses that applied for refunds, Imbert explained cash flow was an issue. “Cash flow constraints have resulted in a 1ne-month delay in completing this exercise,” a release from the ministry said on January 16. “As a result of oil and gas production being below estimated levels, coupled with depressed oil and gas prices in the latter half of calendar year 2024, the revenue collected by the Government in the last three months of calendar 2024 was lower than expected” As a result of the cash flow issues, the ministry said Government had to prioritise its expenditure, addressing urgent bills first and resulting in the delay of VAT refunds. “However, oil and gas prices recovered in November and December of 2024, and revenue collection stemming from the tax amnesty has been on the uptick,” the release continued. “Accordingly, there is now sufficient cash flow to fulfil the commitment made with respect to VAT refunds to SMEs. Therefore, the ministry intends to make good on its commitment and follow through on these SMEs, VAT refunds by the end of January 2025.” While president of the Chaguanas Chamber of Commerce Baldath Maharaj welcomed the announcement of the VAT refunds, he was still concerned about delays in payment. Maharaj said VAT bonds were welcomed to address backlog in refunds, but it did not address the root cause of the delay in payments. "While the bonds are a welcomed step toward addressing the backlog, it is important to recognise that businesses have had no choice but to accept these instruments. "For years, the private sector has borne the burden of delayed refunds, forcing many to take on additional costs to maintain cash flow and operations. "Bonds, while helpful to some, are not an ideal solution for all businesses, particularly small and medium enterprises (SMEs) that rely on cash to manage their day-to-day obligations. "Bonds force businesses to either wait for maturity or discount them to access liquidity for less than face value creating unnecessary financial strain. The chamber believes that VAT refunds should be paid promptly in cash, as intended, to support businesses and foster economic growth. Maharaj urged the government to adopt more sustainable and transparent approaches to paying VAT refunds, saying the business community cannot continue to absorb the costs of the inefficiencies in the system. "Timely refunds are not just a legal obligation but a necessity for the economic stability of TT." The post Finance Minister: VAT refunds in cash by this week appeared first on Trinidad and Tobago Newsday.