The Government of Saint Lucia has taken the decision to increase the Value Added Tax (VAT) threshold from $180,000 to $400,000 with the aim of providing greater incentives for the expansion of small business on the island.
This new measure will be introduced with the passing of Value Added Tax (Amendment) Bill 2016, which was tabled in the National Assembly on Tuesday, January 12, 2016.
Prime Minister Dr. Kenny Anthony said it represents a more realistic measure of equity of taxpayers, and provides more breathing space for the small businessman.
“It therefore means that a number of small businesses don’t have to register for the VAT or if they are currently register can now deregister,” he explained.
Dr. Anthony told members of the House that there are some persons who would prefer to continue their registration under VAT, because they would want to claim the input of VAT into whatever goods and services they offer.
Meanwhile, Castries Central MP Richard Frederick said there is a misconception that VAT collection is a manner to unjustly enrich one’s self, explaining that it is essentially collecting money on behalf of the government.
“So when persons make noise that they are not registered, they believe they will collect the VAT and never pay up to government,” Frederick told the House.
Government has said it raked in over $220,000 increase in the VAT threshold in May 2015.
Over 600 VAT registrants will not be required to collect tax on behalf of the government.