The Government of Antigua and Barbuda is pushing ahead with its plan to implement an increase in the Antigua and Barbuda Sales Tax (ABST) despite facing both public and political pushback.
Cabinet has formally announced that Parliament will convene to initiate the legislative process during today’s Budget Speech, introducing the proposed ABST hike alongside two additional pieces of legislation.
The primary focus of the Bill is to raise the current ABST rate of 15 percent to 17 percent.
The government cites financial challenges as the driving force behind the decision, asserting the need for fiscal measures to bolster revenue streams.
The Deputy Commissioner of the Inland Revenue Department, Jermaine Jarvis, anticipates that the ABST increase will contribute significantly to surpassing the tax revenue collected in 2022, which amounted to $752 million.
Of this total, slightly over $300 million was attributed to ABST.
Jarvis emphasised the government’s strategy to broaden the tax base while assuring the public that essential items like chicken, fish, butter, fresh fruits and vegetables, rice, and flour would remain exempt from the proposed increase.
In addition to the ABST adjustment, the Cabinet has unveiled plans to amend the existing “sin taxes” on alcohol, tobacco, and gaming.
Additionally, a modest increase in airport taxes is anticipated, aligning with the government’s broader efforts to meet airport operation obligations.
While these measures are positioned as essential for addressing financial challenges, they have encountered resistance from residents and the opposition United Progressive Party, with the latter picketing this morning’s Budget Speech in protest.
The coming parliamentary session will likely be a focal point for further debate and discussion on the proposed changes.