Property tax pressure. The Opposition United National Congress and Movement for Social Justice have slammed Government’s “rush” towards implementing the property tax and cited problems with mechanisms to handle the process.
On the flip side, as citizens work towards the May 22 deadline for submission of documents for residential properties being requested, assurance came yesterday from the Finance Ministry’s (Property Tax) Division that a minimum of documents may be accepted in that category.
Finance Minister Colm Imbert also clarified some queries arising in the matter, after the ministry on April 19 announced moves towards start of the collection exercise.
In this first phase, the ministry has called for property owners to complete a Valuation Return Form (VRF) and return that, plus supporting documents - including photos of the property - to various Valuation Divisions.
The information is for the calculation of the property’s Annual Rental Value (ARV). The tax will be based on three per cent of that ARV.
According to the ministry, residential owners are being asked to supply 13 documents. Industrial and commercial owners are being asked to supply more.
But MSJ leader David Abdulah, who cited a number of problems arising from Government’s process, said the May 22 deadline “isn’t a realistic deadline and must be altered.”
Abdulah yesterday expressed deep concern about Government’s capacity to handle the confidentiality of home owners’ information - which includes property photos - and that improper handling could see the material being used to target people for crime.
Yesterday, a spokesman handling scores of queries from the public at the Property Tax Division said owners should try to supply as many documents as possible. But if they don’t have any, they should still fill out the form, including location of the premises and its purpose, plus a phone number, the official said. The spokesman said an assessor will subsequently contact the owner to deal with the situation. Also, in the event of a minimum of documents available, they said the most useful document will be the owner’s previous property tax payment receipt (from 2009 when last payments were collected), as well as TTEC or WASA bills.
Yesterday Imbert - when asked by T&T Guardian to respond on several concerns - including the MSJ’s claim that he reneged on 2016 statements to implement the 2009 property tax levels - said: “Reliance should be placed on information provided in the 2017 Budget debate. Using outdated information from prior periods can lead to error.”
He said the 2017 Budget Statement (pages 11-13 and 43) of September 30, 2016, clarifies the issue.
“It should be noted that the Budget Statement of 2017 is the most updated statement on the implementation of the property tax,” he said.
Imbert confirmed that the annual rentable value of a house is calculated based on reasonable estimates and will depend on size, age, condition, location, access, parking, use etcetera. He said Property Tax forms must be submitted by the owner and not by anyone else - such as a valuator. If forms and assessments are done by home owners, he added, a visit from an assessor would be a must only if there is a query.
On whether landlords would pass the burden on to tenants, Imbert said, “The Government has no authority or control over rental rates for private property.”
The Budget had indicated there would be exemptions for home owners unable to afford the tax.
However, Valuation officials said yesterday that such people will still have to fill out the Valuation forms and after that a determination will be made on their case. Exemptions regarding the tax, which will apply under Section 16 (Property Tax act) include for churches, land used exclusively for churches/chapels/places of worship of any religious denomination, cemetery/burial grounds. Exemptions don’t apply to land owned by churches/religious organisations and rented/leased for purposes other than religious.
Exemptions also apply to educational properties, land belonging to the state/statutory authority, state enterprises, as well as hospitals and land owned by a foreign government or international organisation in which T&T is a member.
Opposition Leader Kamla Persad-Bissessar, who expressed concern “about Government’s rush” to implement the tax, said the tax will have a “damaging impact on citizens.”
“The move to effect this tax is causing great concern among citizens already reeling from rising crime levels, increasing food prices, job losses and inadequate health services. It’ll cause further hardship for the unemployed, pensioners, the poor and vulnerable,” she added.
Noting her People’s Partnership government had resisted a property tax, but favoured a tax regime based on the old Land and Building taxes prior to 2010, she added, “ There’s lack of information regarding the calculation of the Annual Rental Values (ARV) for properties.
“Also, the PNM Government has failed to complete the process of local government reform, and as a result no mechanisms are in place to ensure that property tax is spent on local projects.”
The UNC is holding a series of constituency meetings from today up to May 4 to discuss the tax impact and allow citizens to voice concerns.
Today’s meeting in Penal will feature former Central Bank Governor Jwala Rambarran.
RESIDENTIAL DOCUMENTS NEEDED
Previous Land & Building Taxes Receipt for property identified
Deed /RPO Certificate Of Title
Land Survey Plan or Land Area.
Site Plan
Building Plan
Rent/Lease Agreement
Completion Certificate
Town & Country Planning Approval (Status of Land).
Town & Country Planning Approved Use (Change of Use).
Photograph of exterior of the Property
Sketch Of Building
WASA Bill (no more than 3 months old)
T&TEC Bill (no more than 3 months old)
GOVT MISLED PUBLIC - MSJ
MSJ’s David Abdulah, who accused Government of misleading the public, yesterday said, “There must be some form of property tax as it’s always existed in the form of the Land and Buildings Tax. But the issue is how it’s being done, whether it will place an unfair burden on some and whether it’s just a method to raise revenue or to be part of a wider reform of local government.
“Prime Minister Keith Rowley and Finance Minister Colm Imbert must come clean on the issue. At a media conference on May 15, 2016, Mr Imbert stated the tax will be equal to the amount paid in land and building tax in 2009.”
Abdulah noted that Imbert, in April 2016, reiterated Government would seek to collect the amount payable under the old Land/Buildings Taxes for 2009 and assessments were being done to bring property rolls up to date.
“In other words, the PNM’s stated intention and commitment was to make legal provisions so that property owners/occupiers would initially pay the amount of tax they paid in 2009. (So) Government has reneged on a commitment it gave in the Parliament.
“Having heard absolutely nothing from the Minister re: property tax for many months the public suddenly saw ads in the press advising of a May 22nd deadline to submit the completed Property Valuation Return Form together with 13 supporting documents.”
Abdulah claimed citizens risked a $500 fine if they didn’t submit forms by a certain date. He cited section 7 of the Valuation of Land amendment act (act no 17/2009).
But the Finance Ministry last night stated only courts - not Government - could lay charges or invoke “fines.”
Abdulah added, “Can the Valuation Division process the more than 500,000 forms with supporting documents? Do they have requisite staff and data processing (ICT). What system is in place to cross-reference the forms submitted and the data supposedly collected by field teams?
“The PNM’s position during the local government reform consultations was the property tax should go to regional corporations. Today the cart is being put before the horse, as it seems the main driver of property tax is to raise revenue.”
MSJ also demanded:
• Imbert fulfils the Parliamentary commitment that property owners/occupiers pay the 2009 Land and Building Tax amount for 2017.
• A proper education/information process to enable property owners to comply with requirements of the Valuation of Land Act,(2009).
• That Imbert states the Valuation Division’s capacity to process all forms/supporting documents and gives a realistic deadline for the submission of same.
• That he informs T&T on the confidentiality of the information submitted to the Valuation Division (eg copies of deeds can be digitally altered to aggravate the land fraud that now abounds; estimates of property values/photos of properties can be used to target persons for robbery and other serious crimes)
• On what objective basis will the Valuation Division fairly assess the annual rental value of properties? Will there be equity of treatment for pensioners/others in difficult financial circumstances?
• That the new property tax only go into effect when local government reform is completed
• That roll out of the new property tax take place in fiscal 2018 after all necessary checks/balances are implemented.
