SEVERAL tax-relief measures for the business community have taken effect as of January 1, 2022.
The Finance Ministry in a tweet reminded the public of the measures Finance Minister Colm Imbert presented during his $52.4 billion budget for this year.
These are the measures that are currently in effect:
– a five per cent reduction in tax rate for significant exporters of goods for three years;
– 50 per cent tax exemption on the first $100,000 of chargeable income for new companies whose core business activities are digitisation and technology solutions;
– five per cent reduction in tax rate for three years for small, medium enterprise (SME) companies whose core business is technology solutions and digitisation;
– full tax holiday for the first five-year period to new SMEs listing on the TT Stock Exchange;
– $8,000 fine for overweight trucks;
– five per cent reduction in tax rate for the manufacturing sector for two years on qualifying projects;
– reduction in the rate of withholding tax to eight per cent on distribution made and three per cent where such distribution is made to a parent company, subsequent to the amendment of the Income Tax Act;
– increasing the limit to $30,000 on mortgage interest paid by first-time homeowners for five years from the date of acquisition;
– increase in relief granted on approved pension and annuity plans to $60,000;
–100 per cent exemptions on VAT, motor vehicle tax and customs duty on imported battery-powered electric vehicles no more than two years’ old;
– 100 per cent exemptions on VAT and customs duty on specified therapy equipment for the hearing impaired, visually impaired and physically disabled;
– ten per cent increase in utility rebates on bills $300 or less;
– 100 per cent exemptions on VAT and customs duty on all remaining computer hardware, software and peripherals;
– research and development capital allowance (tax relief) of up to 40 per cent of expenditure (in calculating taxable profits incurred by companies in research and development);
– tax credit of 30 per cent up to $500,000 for companies that invest in carbon capture and storage enhanced oil recovery;
– 150 per cent tax allowance of up to $1 million on corporate sponsorship to heritage properties under the oversight of the National Trust.
Commenting on the measures yesterday, Greater San Fernando Area Chamber of Commerce president Kiran Singh said while the Chamber is pleased to see the various measures being put into motion, Value-Added Tax (VAT) refunds need to be expedited, especially for the SME sector.
“We’re aware that the Government’s fiscal situation is in an unhealthy position. Small businesses have become very wary of high-interest rates, extreme due diligence and hidden charges imposed by banks. These factors would have certainly contributed to a fall in demand for financial services (loans). The surplus funds can be redirected to service VAT refunds. We’re only asking for what’s owed to us to be paid in a timely manner. Cash flow is the lifeblood of businesses,” Singh said.
He further noted the measures that took effect will bring some positivity, especially for the manufacturing sector, which is heavily focused on expanding its export drive.