NOT ALL BLACK AND WHITE: Sinckler issues a challenge
THERE ARE SOME who say politics is a blood sport, and others who may say it is just two people sitting next to each other in church and wondering how in the name of the Almighty their seating “malfunction” occurred.
Those may be the two extremes – at one end the horrific and at the other the hilarious – but your humble columnist is thankfully shielded from all of that, since I would be the world’s worst politician. Ever.
We are now awaiting the Government’s new Budget for the fiscal year 2016-17, and at an impromptu press “briefing” last Wednesday in the lobby of Scotiabank’s Broad Street branch Minister of Finance Chris Sinckler spoke about his main area of focus for the Budget, which is public health financing.
I joined the scrum a bit late, so it was a few minutes before I asked a question, and then Mr Sinckler posed a challenge to me.
He said: “And I really wish you would write this in your column – I mean you, Pat, (when you are writing) all about the ‘Dolittle government’. You should broaden your horizon and do a complete analysis.”
It was not said with animosity, as there is no “bad blood” between the Minister of Finance and myself. If I found myself sitting in a pew next to him, we would talk.
So in that spirit, I have decided to share you today what Mr Sinckler said to back up his challenge, in his own words. This is how he sees the dilemma he has faced as Minister of Finance:
“When this recession hit Barbados, and (with it) the challenges in the financial sector, Barbados lost a tremendous amount of international business, and investment too . . . to the extent where our corporation tax revenues have dropped about $200 million dollars (a year). A lot of those allowances and claims which you see in the tax system – (and) a lot of other things which you see here in Barbados that (the Arthur administration) was able to do pre-2007 – were predicated on that amount of money being made available.
“Once that money was not available – through no fault of our own . . . and that $200 million hole was blown in the corporate tax revenues, it made it extremely difficult to sustain all of these things.”
Mr Sinckler said he did not agree with the suggestion that Barbados was too slow to move on new legislation for the international business sector.
“No, that’s not true. In fact, in the last six years, we have put more new pieces of legislation for product in international business and financial services than any other administration in the history of Barbados . . . . The problem is that the international community is becoming so overly aggressive towards these so-called tax havens – we are not a tax haven – that every time you think that you have met the standard, they move the goalposts to something else. You have to keep playing catch-up all the time.”
The result has been to increase taxes on Barbadians, he said, “and we’ve had to put on quite a few taxes on people – but there’s a limit to which you can do that – to compensate”.
“So those are things that we had to do. Painful? Yes. Inconveniencing? Yes. But absolutely (unavoidable). And that’s just the way it is. And I tell you, regardless of whichever party is in Government, these are the realities they are going to have to face, and the policy mix is not going to be very much different because Barbados, as a small, structurally vulnerable economy – with very few levers to pull to protect itself – has to use instruments at its disposal.”
Next week, I will probably go back to criticising the Government on its economic policies, but I am hoping that Mr Sinckler’s next Budget will make a believer out of me.
Pat Hoyos is a journalist and publisher specialising in business.