Trinidad and Tobago's deadline for passing US tax legislation looms as politicians 'play games' – Caribbean News Now

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The deadline for Trinidad and Tobago to become a signatory to the United States’ Foreign Account Tax Compliance Act (FATCA) is September 30, 2016. The law, which the US Congress enacted in 2010, strives to ensure that US citizens and residents with financial assets outside of the country are paying taxes.

The legislation gives US banks the power to withhold a portion (up to 30%) of payments made to foreign financial institutions that do not agree to release information on their customers who have US accounts. In fact, they can even refuse to do business with them altogether. Non-compliance would therefore have far-reaching effects: critical banking services such as credit card use, wire transfers and remittances would be cut off, Trinidad and Tobago's economy -- already sluggish thanks to low energy prices -- would further weaken, and the general cost of living and doing business would increase.

Yet, the bill has still not been passed in the country's parliament. Even though the government is unanimously voting for compliance, the current opposition -- which had put forward the bill when they were in government -- now appears to be stonewalling its passage. The government has 23 members in the House of Representatives, but 26 votes are needed to pass the bill. Despite its insistence that “nobody wants to pass this bill more than [them]”, in the parliamentary sitting of September 23, 2016, every single member of the opposition voted “No” (54:46 on the timeline of this video). For its part, the opposition has accused the government of “politicising the issue”.

The leader of the opposition, Kamla Persad-Bissessar, explained that she and her colleagues are worried about “the draconian provisions in the Bill, which are in no way necessary to give effect to the agreement”.

In his presentation to parliament, minister of finance Colm Imbert noted, “Clause 8 -- the opposition has a problem with this. Nothing in Section 4 of the Income Tax Act, Data Protection Act or any other law of like effect prevents the disclosure of information. The opposition maintains that this strips our citizens of any protection that the law may give to them.”

Although the government has said that they addressed three of the opposition's seven concerns, the matter never went to debate. After Imbert made his presentation in parliament last Friday, he asked the speaker of the house for a one-hour adjournment, during which time the two sides could sit down and hammer out the amendments to the bill. But the opposition refused. Soon after the parliamentary sitting resumed, the opposition leader was reprimanded by the house speaker and asked to leave. The rest of the opposition (save one member) -- in an apparent show of solidarity -- walked out.

Theoretically, parliament would be able to meet on September 30 and pass the bill just in time to meet the deadline -- but that is the date on which the minister of finance will present the country's 2017 budget, so there is no chance of FACTA being tabled for discussion then. Unless the United States agrees to extend the deadline, which at this point seems likely, Trinidad and Tobago will be left in a tenuous position. No matter what happens, though, netizens are incensed.

Wired 868's news blogger Mr Live Wire quipped: "Quite unhelpfully, Finance Minister Colm Imbert booked his Budget speech on the same day. Presumably, Imbert did not foresee that the [opposition United National Congress] UNC would feign such a startling ignorance of what is at stake here."

Read the full report here.