Imbert Delivers $52.4B Budget 2022: Removes VAT on More Food Items

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By Prior Beharry

FINANCE Minister Colm Imbert delivers a $52.429 billion Budget 2022 pegged on an oil price of US$65.

He also removed Value Added Tax (VAT) on some basic food items.

Eniath, Sports, sportsware

With revenue expected to be $43.333, it means that there will be a fiscal deficit of $9.06 billion.

Delivering the Budget in the Lower House on Monday, Imbert said it will also be based on a natural gas price of US$3.75 Metric Million British Thermal Unit (MMBTU).

Education received the biggest piece of the pie with more than $6b.

The following is the allocation for ministries:

  • Education and Training $6.886 billion;
  • Health $6.395 billion;
  • National Security $5.664 billion;
  • Works and Transport $3.577 billion;
  • Public Utilities $2.671 billion;
  • Rural Development and Local Government $1.656 billion;
  • Agriculture $1.249 billion; and
  • Housing $0.610 billion.

The theme of the Budget was titled “Resilience in the Face of a Global Pandemic.”

No VAT on basic food items

Imbert said the 12.5% VAT will also be removed from cheddar cheese which he described as a staple in homes.

He said although some commentators suggested a removal of import duties on basic food items to combat rising food prices, this would have an adverse effect on domestic producers of these items.

For example, he said the remove of import duties on chicken would have a disastrous effect on T&T’s poultry industry.

Imbert said the zero rating of basic food items would include biscuits, cooking oil, canned vegetables, corn flakes, canned fish, canned meat, curry, juice, sausages, ham, ketchup, bottled water and pigtail.”

Battery-operated electric vehicles

The taxes and duties on battery-operated electric vehicles will be removed.

He said, “I propose to remove all custom duties, motor vehicle tax and value-added tax on the importation of battery-powered electric vehicles with an age limit on imported used battery powered electric vehicles of two years.

“This measure will take effect from January 1, 2022 and will be reviewed after two years.”

Support for persons with disabilities

Imbert said the Government was committed to providing the necessary support and aid to persons with disabilities.

He said, “I propose to remove all VAT and custom duty charges on specified therapy equipment, hearing impaired, visually impaired, physical mobility disabilities, disability safety peripherals and communication.

“This measure will assist persons with disabilities to purchase the required peripherals and equipment at a reduced cost. This measure will take effect on January 1 2022.

10M First Citizens Shares for Sale

Imbert said the Government will divest 10,869,565 ordinary shares in First Citizens Bank in a bid to raise approximately $550 million.

He said the Government’s current holding is 64.43% or 161,946,890 shares.

Imbert said First Citizens Bank’s Annual Report indicated that for the financial year ended September 30 2020, profit before tax amounted to $831.6 million; as well as profit after tax to $606.9 million.

T&TEC, WASA rebates

The finance minister said T&TEC residential customers who receive a bill of $300 or less will have their rebate increased from 25% to 35%.

Imbert said, “This would affect 210,000 households at an additional annual cost of $25 million.

“This measure will take effect from 1 January 2022. Madam Speaker, I also propose to appropriately offset the cost of water for the same group of households receiving the T&TEC bill rebate.

“Further details will be announced in the Finance Bill of 2021.”

Computer hardware, software and peripheral

He also announced the removal of all import duties and taxes (VAT and online purchase tax) on remaining computer hardware, software and peripherals that are not yet tax free.

This measure will take effect on January 1, 2022, the minister said.



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