Private sector testifies against tax bill
There were no guns evident in Belmopan today but close to forty people showed up to take aim at the new business tax proposed by the Esquivel administration. The occasion was a public hearing on the legislation before the House Ways and Means Committee. The committee, chaired by Melvin Hulse and including Dito Juan, Salvador Fernandez, Henry Young, Ralph Fonseca and Vildo Marin, heard testimony from representatives of the Chamber of Commerce and Business Bureau as well as key players in the citrus, tourism, airline and other industries. If anyone was in favor of the bill they didn’t bother to show up, as witness after witness described the new tax as being unfair to the already hard pressed private sector as well as inflationary and discouraging to foreign and local investment. News Five’s Stewart Krohn, who also testified against what he called the bill’s discriminatory provisions against the broadcast television industry, sampled some opinions.
Therese Rath, Director, Belize Hotel Association
“Well we’re really concerned. I think that most people are aware of the, basically a crisis that our tourism industry is already in that we have a very short season. Whatever profit we make has to maintain us for the entire year. We’re doing a lot of work to try and increase our marketing to improve our service. And in many of the businesses in the tourism industry are small businesses and it is no fallacy that there are many of them that aren’t a break-even point. I think a tax like this will only do one thing: it will force those businesses that are marginal to increase their prices which our industry analysis has shown us the market cannot hold.”
Michael Plowey, President, American Business Council
“This is a problem because we have potentially investments in the software industry, other investments in the agriculture industry that are interested in putting processing plants here in Belize that are high revenue industries. These industries will be penalized because of their high revenue basis by having to pay a gross receipts tax. Furthermore this gross receipts tax will be a tax on exports which will be the market that these investments will be targeting. I don’t know of any country on the planet that taxes exports.”
Kay Menzies, Director, Belize Business Bureau
“This tax does not make allowance for businesses that are losing, businesses that are losing, businesses that operate on a very narrow margin. For example we’re talking fueling stations, businesses in development. We have a lot of companies with financial incentives that are in the growing stage at the moment. Most companies take about five years to get on their feet; they operate on a loss. This would only increase the loss.”
There were so many people who came to testify that a further hearing was scheduled for Friday at which representatives of B.T.L. and other companies will be heard. When contacted by phone late this afternoon Opposition Committee member Ralph Fonseca called the Esquivel proposal, which includes an income tax cut, “another blatant attempt to buy votes that has boomeranged and come back to knock the U.D.P. in the head.” In addition to committee hearings, Prime Minister Manuel Esquivel has agreed to an open meeting with the business community on June twelfth at the Biltmore Plaza Hotel.
