Prime Minister Gaston Browne will be pressing ahead with his government’s plan to increase the Antigua and Barbuda Sales Tax (ABST) by two per cent.
Browne, who is also the finance minister, will present the tax increase during his 2023-2024 budget speech on December 15.
The increase will take the ABST rate from 15 to 17 per cent.The government previously said increasing ABST will help fund growing expenditure commitments such as the 14 per cent increase to public service salaries.
During yesterday’s Post-Cabinet Press Briefing, Information Minister Melford Nicholas said officials at the Finance Ministry deliberated on multiple ways to close the expenditure gap to ensure government spending is sustainable and increasing the ABST was a prime suggestion.
He said the tax increase is considered appropriate at this time and the ministry is looking at how it will be implemented.
“We’re still thinking that it is appropriate and the Ministry of Finance officials have been asked to look at a phased implementation of these measures and I guess more will come over the next two weeks,” he said.
Nicholas is confident that the two percent increase will have little to no impact on the cost of basic food items since many of them are zero-rated.
“As indicated by the prime minister…the government intends to protect the most poor and vulnerable,” he commented.
The list of zero-rated items includes flour, rice, chicken, vegetables and baby formula.
Nicholas added that citizens should not see the tax increase as a sign that the country’s economy is collapsing but rather that the government is looking to make Antigua and Barbuda’s fiscal situation better.
