| Customs fee expected to raise $12 million | | Print | |
| Thursday, 14 April 2011 10:02 | |||
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The Turks and Caicos Islands government expects to see an additional $1 million rolling into its accounts this month with a 4-percent Customs Processing Fee that went into affect April 11. The Ministry of Finance announced the implementation of the fee last week which will be charged on the value of all goods imported into the country. The aim is to capture revenue from organizations that currently hold duty exemptions and concessions, which the government says “undermine” the system of import duties and reduce the effective duty rate significantly. The move is part of an overall revamp to the government’s budget, which includes new fees and cuts to government spending. The current interim government has a major budget gap of around $55 million to close in the next two years before the country can be handed back to local governance. According to Permanent Secretary in the Ministry of Finance, Delton Jones, the CPF will apply to all items imported through the various ports. The only exceptions to this rule will be the government and Interhealth Canada, which have a standing order for exemptions on imported goods. Jones says adding the CPF to Interhealth’s costs would simply add extra costs to the government budget for the length of the contract. It will also not apply to the $400 duty exemption for residents and $50 exemption for tourists coming via airplane into the country. Jones also said the CPF will preserve the changes to the import duty tariff that were introduced last year intended to simplify the tariff structure, improve administration and provide some help to lower income families and small businesses. A 10-percent Customs Surcharge was removed last August, which was imposed in as a temporary measure in 1991. The fee collected was charged at 10-percent of the duty to be paid, which did not collect any money from those who were not paying duty. “It is important to note that,” Jones said, “even with the new Customs Processing Fee, import duties on a wide range of essential goods will still be lower than they were in 2009-10.” Many duty rates were reduced in August, including many food items and essentials such as baby products and personal care products. During a presentation on the changes to the Consultative Forum, Customs Advisor Geoffrey Thorne told members that reductions were being made in the 12 percent and 25 percent duty rates on imported foodstuff to 10 percent and 15 percent respectively. In some cases the rates were dropped altogether. “Coupled with the removal of the Customs surcharge, this will result in an overall reduction of between 3.2 percent and 27.5 percent,” Thorne said. In addition, reductions were made across the board on construction materials from 30 percent to 10 percent and on “green” items. Fish not caught locally was reduced from 40 percent and 25 percent to 15 percent. However, many residents continue to complain that they are not seeing the affects of these reductions in local retail prices. “We strongly urge those who have not yet done so to pass on the benefit of this overall reduction to their customers,” Jones said.
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