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Tuesday, July 5, 2022
HomeNewsArchivesFINANCE DUMPS TAX MEASURES IN TURNBULL BUDGET

FINANCE DUMPS TAX MEASURES IN TURNBULL BUDGET

Three of Gov. Charles W. Turnbull's major revenue sources for his Fiscal Year 2001 budget were summarily tossed out the window by the Senate Finance Committee Friday.
After more than six hours of testimony, the committee tabled indefinitely the proposed gross receipts tax increase, the 50/50 cost-sharing government employees' health and retirement plan, and a measure to eliminate the road tax exemption for taxis, and impose a highway user fee in addition to the road tax.
Sen. Violet Anne Golden moved to table four bills in block, the governor's three plus one proposed by Sens. Norman Jn Baptiste and Adelbert "Bert" Bryan which would impose a "sin tax" on alcohol, cigarettes, expensive cars and some electronic equipment.
The bills' demise will further exacerbate the territory's delicate financial condition and strain the already unwieldy budget. The gross receipts tax was slated to generate between $20 million to $24 million to go toward teacher's salaries, and the 50/50 cost-sharing retirement and health bill proposed a $7.3 million savings.
But the bills' rejection came as no surprise, as throughout the day senators made it plain they were not approving any taxes. Both of the territory's chambers of commerce as well as the St. Thomas-St. John Hotel and Tourism Association have spoken out vehemently against the gross receipts tax hike, as well as the highway users tax.
The popularity of the gross receipts tax increase has been right up there with a return to colonial rule.
St. Thomas-St. John Chamber of Commerce president John deJongh Jr. said Friday the proposed gross receipts tax increase from 4 to 5 percent is "ill-conceived and flawed." He asked how such a tax could be conceived in an economy where the private sector is shrinking.
"The employment base has been stagnant for more than two years and a 25 percent increase on top of the recent 25 to 30 percent recent WAPA increases is unimaginable," he said.
St. Croix Chamber president Carmelo Rivera was equally adamant. He said the measure would "hurt more St. Croix businesses . . . and may cause more businesses to close." "We should collect the money out on the streets," he said.
Golden had a novel idea. "Sacrifice is the buzzword here today," she said, and pointing to deJongh, she said, "I have a challenge for you." She cited the administration's apparent contempt for the private sector, and said, "I challenge you to close up shop for one day, the stores, the taxis, everybody, if you could afford it." She said that would "show everybody how much you mean to them, the people who vilify you."
Also testifying was Debra Gottlieb, acting director of the Office of Management and Budget (Director Ira Mills is off-island), acting Internal Revenue Bureau director Louis Willis, economist Richard Moore, Corrine King, chairwoman of the board of the Government Employees Retirement System, Industrial Development Commission director Frandelle Gerard, taxi association officers, and Aubrey Nelthropp, longtime St. Thomas businessman.
None of them had anything good to say about any of the governor's tax proposals.
Nelthropp, in opposition to the gross receipts tax, said he represented the small businessman and painted a picture of just what it is like today for a small business in St. Thomas to survive.
Willis wholeheartedly agreed with Rivera's assessment of what should be done about collecting taxes, but he said he had a dilemma, a "management decision," that he was finding it difficult to make. "Should we pay $3,000 per day in interest on unpaid refunds, or use the money to hire tax collecting officers?" Willis is expected to deliver a remedial plan for reorganization of the IRB to the Finance Committee next month.
Gottlieb was in the hot seat defending the administration's budget. She reiterated the governor's stand on his revenue enhancement measures as "equitable and least painful." Committee Chairwoman Lorraine Berry asked Gottlieb, "What can we do to fill the 21 vacancies Mr. Willis has in his department? If he isn't fully staffed, he will lose his battle."
Gottlieb replied that the government is living on a rollover appropriation of $450 million. In her opening statement, Gottlieb had said that whenever funds are identified to satisfy needs in one area, another area suffers.
King gave a lengthy dissertation on the 50/50 retirement proposal splitting the cost between the employee and GERS. She has spoken before the committee several times this year, and has remained unconvinced of proposed measures to fund the system, including the one signed into law Thursday by the governor. King has said all the measures, including the 50/50 proposal, would add to GERS' unfunded liability.
Eustace Grant, V.I. Taxi Association president, questioned why the government always wants to "put the burden on the back of the working man."
Gerard testified early in the session on an amendment of her own to counter the governor's bill to revise IDC regulations and fees. She was to have returned in the afternoon session for further testimony, but did not return. The IDC measure and a bill to enact the Technological Enterprise Act of 2000, a far-reaching 180-page document, were both held in committee until next Thursday.
Committee members present were Berry, Golden, Gregory Bennerson, David Jones, Roosevelt David and George Goodwin. Nonmembers attending were Bryan and Jn Baptiste. The motion tabling the bills passed unanimously 6-0, with Alicia "Chucky" Hansen absent. The budget hearings resume at 10 a.m. Monday on St. Thomas.

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Three of Gov. Charles W. Turnbull's major revenue sources for his Fiscal Year 2001 budget were summarily tossed out the window by the Senate Finance Committee Friday.
After more than six hours of testimony, the committee tabled indefinitely the proposed gross receipts tax increase, the 50/50 cost-sharing government employees' health and retirement plan, and a measure to eliminate the road tax exemption for taxis, and impose a highway user fee in addition to the road tax.
Sen. Violet Anne Golden moved to table four bills in block, the governor's three plus one proposed by Sens. Norman Jn Baptiste and Adelbert "Bert" Bryan which would impose a "sin tax" on alcohol, cigarettes, expensive cars and some electronic equipment.
The bills' demise will further exacerbate the territory's delicate financial condition and strain the already unwieldy budget. The gross receipts tax was slated to generate between $20 million to $24 million to go toward teacher's salaries, and the 50/50 cost-sharing retirement and health bill proposed a $7.3 million savings.
But the bills' rejection came as no surprise, as throughout the day senators made it plain they were not approving any taxes. Both of the territory's chambers of commerce as well as the St. Thomas-St. John Hotel and Tourism Association have spoken out vehemently against the gross receipts tax hike, as well as the highway users tax.
The popularity of the gross receipts tax increase has been right up there with a return to colonial rule.
St. Thomas-St. John Chamber of Commerce president John deJongh Jr. said Friday the proposed gross receipts tax increase from 4 to 5 percent is "ill-conceived and flawed." He asked how such a tax could be conceived in an economy where the private sector is shrinking.
"The employment base has been stagnant for more than two years and a 25 percent increase on top of the recent 25 to 30 percent recent WAPA increases is unimaginable," he said.
St. Croix Chamber president Carmelo Rivera was equally adamant. He said the measure would "hurt more St. Croix businesses . . . and may cause more businesses to close." "We should collect the money out on the streets," he said.
Golden had a novel idea. "Sacrifice is the buzzword here today," she said, and pointing to deJongh, she said, "I have a challenge for you." She cited the administration's apparent contempt for the private sector, and said, "I challenge you to close up shop for one day, the stores, the taxis, everybody, if you could afford it." She said that would "show everybody how much you mean to them, the people who vilify you."
Also testifying was Debra Gottlieb, acting director of the Office of Management and Budget (Director Ira Mills is off-island), acting Internal Revenue Bureau director Louis Willis, economist Richard Moore, Corrine King, chairwoman of the board of the Government Employees Retirement System, Industrial Development Commission director Frandelle Gerard, taxi association officers, and Aubrey Nelthropp, longtime St. Thomas businessman.
None of them had anything good to say about any of the governor's tax proposals.
Nelthropp, in opposition to the gross receipts tax, said he represented the small businessman and painted a picture of just what it is like today for a small business in St. Thomas to survive.
Willis wholeheartedly agreed with Rivera's assessment of what should be done about collecting taxes, but he said he had a dilemma, a "management decision," that he was finding it difficult to make. "Should we pay $3,000 per day in interest on unpaid refunds, or use the money to hire tax collecting officers?" Willis is expected to deliver a remedial plan for reorganization of the IRB to the Finance Committee next month.
Gottlieb was in the hot seat defending the administration's budget. She reiterated the governor's stand on his revenue enhancement measures as "equitable and least painful." Committee Chairwoman Lorraine Berry asked Gottlieb, "What can we do to fill the 21 vacancies Mr. Willis has in his department? If he isn't fully staffed, he will lose his battle."
Gottlieb replied that the government is living on a rollover appropriation of $450 million. In her opening statement, Gottlieb had said that whenever funds are identified to satisfy needs in one area, another area suffers.
King gave a lengthy dissertation on the 50/50 retirement proposal splitting the cost between the employee and GERS. She has spoken before the committee several times this year, and has remained unconvinced of proposed measures to fund the system, including the one signed into law Thursday by the governor. King has said all the measures, including the 50/50 proposal, would add to GERS' unfunded liability.
Eustace Grant, V.I. Taxi Association president, questioned why the government always wants to "put the burden on the back of the working man."
Gerard testified early in the session on an amendment of her own to counter the governor's bill to revise IDC regulations and fees. She was to have returned in the afternoon session for further testimony, but did not return. The IDC measure and a bill to enact the Technological Enterprise Act of 2000, a far-reaching 180-page document, were both held in committee until next Thursday.
Committee members present were Berry, Golden, Gregory Bennerson, David Jones, Roosevelt David and George Goodwin. Nonmembers attending were Bryan and Jn Baptiste. The motion tabling the bills passed unanimously 6-0, with Alicia "Chucky" Hansen absent. The budget hearings resume at 10 a.m. Monday on St. Thomas.