THURSDAY 05/31/12 , St. Maarten – Finance Minister Roland Tuitt has requested the Board of financial supervision (Cft) to give the government three weeks to present them with solutions to the perceived deficit in the budget for 2012. That is the core of his response to the body’s letters dated April 20 and May 9, in which they express concern about a potential 21 million guilder shortfall in the budget. The shortfall is brought on by the fact that government will not be able to collect income tax from mostly American property owners who rent out their properties.
One of the ways that the government plans to cover the shortfall in the budget is via higher yields from the turnover tax. Tuitt estimates that roughly 19 million guilders extra has been yielded.
“We hope that by next week we will have solutions, so we can report to you how these problems are solved. I also wrote a letter to the Cft asking them for three weeks to be able to gather the information, prepare the budget amendments and then we would be able to report to them that we have solved these problems,” Tuitt said.
The Minister has made his request for additional time so that the country avoids being faced with an instruction on the budget from the Kingdom Council of Ministers. Curacao is currently facing such an instruction.
“We don’t want to get into that. So that’s why we asked for an extension of three weeks,” Tuitt said.
Cft’s Secretary Kees van Nieuwamerongen says the body has granted the minister his request for three weeks and will be ready to provide a reply on his proposals when he submits them for review. The body was willing to give the extra time, especially since Tuitt has just become a minister.
Tuitt also announced on Wednesday that he is busy preparing an amendment to the 2012 budget that will give government the legal space to pay out roughly 17 million guilders in Cost of Living Adjustment for 2010 to teachers and civil servants. This was not included in the budget parliament approved earlier this year. Tuitt has also asked all ministries to provide information on any shifts they want to make to the budget so it can be included in the amendment he’s preparing.
“If they (the ministries) want to shift items, from one item to another, you will have to prepare a budget amendment. So right now I’m asking all the ministries to send that information to us, so that the finance department can prepare all of these budget amendments to bring the budget into balance the way the law prescribes,” Tuitt said.
The finance minister has also announced that the Foundation Government Accountants Bureau (SOAB) should finish their analysis on the financial statements for 2010 soon and that the 2011 financial statements are being prepared for submission. The government is required to submit its financial statements by September 1.
Tuitt is also busy preparing a cash flow projection which will allow him to see if there is room to pay out the Cost of Living Adjustment. Next to the adjustment the government will also have to find money to pay vacation allowance and periodic increases that are due to civil servants.
The finance minister has also pledged to deliver a financial report for 2011 and part of 2012 soon. The minister is required to submit the report, which is called Voorjaarsnota in Dutch, by Article 44 of the Accounting Ordinance. The deadline of May 15 has already been missed. Tuitt must also submit a report on developments on the current financial year (2012) by August 15 at the earliest and November 15 at the latest.