Dominica PM announces new initiatives to reopen economy

Dominica PM announces new initiatives to reopen economy

Tuesday, May 19, 2020

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ROSEAU, Dominica (CMC) – The Dominica Government says it has spent an estimated EC$22 million in direct costs so far in its response to the coronavirus (COVID-19) pandemic even as it outlined new initiatives to assist nationals, some of whom have lost jobs as a result of the virus.

Prime Minister Roosevelt Skerrit, in a nationwide broadcast on Sunday night, said his Administration has had to utilise the funds – even at a time when, for obvious reasons, “our revenues are plummeting” – to deal with the COVID-19 that had infected 16 persons here. Dominica has not recorded any deaths..

Skerrit said that in April, collections from personal income tax declined by 12 per cent, corporate income tax declined by 91 per cent, value added tax (VAT) declined by 34 per cent, Customs excise tax 30 per cent, and import duties by 19 per cent.

“Similarly, as expected, we have seen a decline in CBI [Citizenship by Investment] revenue. Taxes collected by the Customs division are estimated to decline by an average of 30 per cent for the months of April to June 2020. Taxes collected by the Inland Revenue Division are projected to fall by an average of 20 per cent for that same period,” Skerrit said.

He said the loss of revenue as a result of the pandemic, which forced a lockdown of the island, must be viewed in the context of a country that is still recovering from the utter devastation caused by Hurricane Maria less than three years ago.

“Notwithstanding the negative impact of the pandemic on Government's fiscal situation, the need to address the economic challenges currently being encountered by many of our residents and businesses has not been ignored.”

He said that with the assistance of the St Kitts-based Eastern Caribbean Central Bank (ECCB), the Government had engaged the financial institutions to provide relief to customers from payment of loans, mortgages and credit card debts.

“In most instances customers have the option to defer payments for a period of up to six months and I am advised that many people are taking advantage of that option. We also extended the deadline for the filing of personal and corporate income tax returns, and the payment of income tax was extended by three months for companies with financial year ending in January 2020 to June 2020.”

He said the Government would give consideration to waiving penalties for businesses that enter into payment plans within six months of the new payment deadline, for amounts due in respect of the same tax periods.

Skerrit said the Government is committing to spending an additional EC$10 million under the Contingency Emergency Response Component (CERC) of the Emergency Agricultural Livelihoods and Climate Resilience Project, providing support to crop and livestock farmers.

“To assist with meeting the cost of farm labour and other direct costs, cash grants have been approved to approximately 2,500 individual crop farmers. The amount of these grants is based on the size of the farmer's holding. Farmers with small holdings will receive grants of EC$700, medium holdings EC$1,400 and large holdings EC$2,800. This intervention is valued at EC$3.5 million.”

Skerrit said he is confident that the interventions will help lower the food import bill, reduce household expenditure, improve dietary quality, and increase sustainable employment.

He said that the Government is also putting plans and policies in place to stimulate other sectors of the economy, especially in the construction sector, which will positively impact employment.

Skerrit said the Government is expecting to sign a number of high-value contracts over the next few days, while many other projects will begin soon.

He said the Government will also pay small contractors and merchants with amounts owed of EC$100,000 and less in the coming days, utilising the resources approved by the International Monetary Fund (IMF) under the Rapid Credit Facility.

“The intention is that small contractors will be in a position to resume work on small projects and complete these works in the coming weeks and months. Being mindful of the approaching hurricane season, Government will also continue its aggressive housing programme and accelerate it where possible.”

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