Small companies find it hard to establish bank accounts and so are withholding their foreign exchange from the formal economy, warned Tabaquite MP Dr Suruj Rambachan in Friday’s Lower House debate on the Finance Bill 2017. He said small businesses are frustrated when they deposit US dollars into local accounts but when seeking to withdraw them are simply given cheques for the amounts which they have no bank account by which to cash them.
“There’s a big underground economy of people dealing in cash. The country is not seeing this money. The biggest trade of US dollars is in the informal economy.”
Rambachan said many local businesses both big and small are having great problems to pay their bills, with these difficulties then having a knock-on effect to creditor forms which in turn also then face similar problems. He warned that the Government’s inability to pay VAT refunds to companies is now “strangling” local businesses. Rambachan advised the Government to cut gross inefficiencies in the public sector especially in an unnamed public utility company, rather than impose more taxes on the population. He then warned of a social time-bomb posed by persons in the bottom 77 per cent of TT’s workforce who earn less than $6,000 per month and pay no taxes. These number 494,000 people, out of the 645,000-strong labour force.
Saying people without jobs develop hopelessness, depression, anger and violence, he warned that in time people will fight back against the establishment. “Don’t take people’s (current) indifference as a sign that everything is alright.”
He urged the poor be weaned off of dependency, and the middle class be saved.
“Don’t destroy the middle class who have the potential to reconstruct TT. Is there a middle class in TT? If the middle class cannot purchase and spend, then you have a problem.” Challenging the true effectiveness of community parenting workshops touted by the Government, he complained of “too many academic interventions without measurable outcomes.” Saying much social reconstruction is done by non-government institutions such as religious bodies, he urged that tax earnings be given to them, to help snatch back communities from gang culture.
Lamenting the prospect of more taxes on the citizenry, he bemoaned, “Sacrifices are already taking place in a very serious way. People are buying less and are eating less-nourishing food. This is a very serious issue.” He lamented many people are losing their jobs and some work only two or three days per week. Rambachan urged the Government to speed up the construction sector to stimulate the economy.