House Begins Debate on Bills to Improve Tax Collection

The House of Representatives on Tuesday, July 22, began debate on two pieces of legislation, aimed at enhancing the collection of revenues and improve compliance.

The Bills, entitled the Tax Collection (Miscellaneous Provisions) Act, 2014 and the Tax Penalties (Harmonization) Act, were piloted by Minister of Finance and Planning, Dr. the Hon. Peter Phillips.

The Minister pointed out that the Bills will introduce a suite of amendments to the Tax Collection Act, the Revenue Administration Act, the Income Tax Act and the Education Tax Act, intended to improve and increase the collection of domestic taxes of all types.

“This is to be achieved through the introduction of new collection related mechanisms as well as the generalized applications of tools now available only in support of the collection of certain taxes, and these tools are to be extended across the entire gamut of tax types,” he informed.

Dr. Phillips said that enhanced collection methods are needed to lend support to the efforts of the Tax Administration to meet its revenue targets in a sustainable manner, “thus reducing the need for amnesties and other special projects.”

“There is an endemic culture of tax avoidance and I dare say tax evasion that has, over many years, created the conditions that underlie the buildup of debt in the country,” the Minister noted.

He informed that the amendments contained in both Bills are a follow-up to the 2013 amendments to the Revenue Administration Act, which strengthened the powers of the Commissioner General to gather tax related information.

“These provisions should allow the information now being collected to be put to efficient use in support of collection. The intent of the new provisions is to bring non compliant behaviour out into the open to mass media and public records, reducing the level of ease with which tax dodgers and cheats proceed with their business, masquerading as good citizens, corporate or otherwise,” the Minister said.

The Tax Collection (Miscellaneous Provisions) Bill seeks to amend the Revenue Administration Act, the Income tax Act and the Tax Collection Act to provide additional measures to facilitate the collection of taxes.

The additional provisions include a requirement by the Income Tax Act for all bodies corporate, including registered charitable organisations and other persons, to be prescribed to file tax returns.

It also provides for an amendment to the Revenue Administration Act to authorize the Commissioner General to provide information to Credit Bureaus under the Credit Reporting Act regarding taxes owed by tax payers.

The Bill provides for an amendment to the Revenue Administration Act to extend the powers of the Commissioner General with regard to the production of information and documents to include the Commissioner of Customs.

As for the Tax Penalties (Harmonization) Bill, it seeks to amend the Education Act and the Income Tax Act, so as to increase the penalties for various offences under those Acts.       It also makes penalties for similar offences under the various Acts more consistent and removes those which are outdated.

“The new penalties in these Acts are designed to harmonize logically with those introduced last year in amendments made to the Revenue Administration Act in support of the gathering of tax related information,” Dr. Phillips said.

Debate on the Bills continues on July 23, in the House of Representatives.