Prime Minister Skerrit Justifies the Need for VAT

 Press Release: Published 10 July 2012

Prime Minister and Minister for Finance, Hon. Roosevelt Skerrit has been underscoring the importance of Dominica’s 15 percent Value Added Tax as a crucial revenue-earner for the Government.

Days before the presentation of the 2012-2013 National Budget, the Prime Minister is not encouraged by suggestions from opposition circles on how the Government should manage the country’s economy.

The Prime Minister says suggestion by the Opposition for the removal of the Value Added Tax is not sound advice at this time.

“ I hear today of people who say they love Dominica talking about all sort of nonsense about what the Government should do or should not do in this upcoming budget. People talk about removing VAT altogether but with no alternative suggestions.”


” You remove VAT then what do you replace VAT with? How is Government going to pay public officers and to help maintain goods and services?” the Prime Minister questioned.

Prime Minister Skerrit says his Government’s decision to introduce the Value Added Tax or VAT several years ago was a necessary one.

He says further that due to the global financial crisis, several countries around the world have had to increase taxes including the VAT.

“What we have seen in other countries is that not only have they maintained the VAT legislation, they have increased the VAT. In the United Kingdom for example the VAT there is 20%, in Barbados it was increased to 17.5%”.

The VAT was officially introduced in Dominica in March of 2006 and since then has been be a significant revenue-earner for the Government.

The VAT replaced the consumption tax of twenty percent (20%) on most goods, the sales tax of seven point five percent (7.5%) on all goods, the hotel occupancy tax of five percent (5%) and the entertainment tax.

The VAT was imposed at a general rate of fifteen percent (15%). A reduced rate of ten percent (10%) was also applied to hotel accommodation.