Barbados gov't hoping to raise millions from taxes on cell phone use

The Barbados government has introduced legislation amending the Value Added Tax (VAT) to allow for a 22 per cent tax on voice and other transmissions from cell phones.

Finance Minister Chris Sinckler told legislators on Tuesday night that the tax, which goes into effect from January 1, next year, will raise BDS$14 million annually that would go towards funding university scholarships.

Sinckler said the proposed changes are meant to “increase the efficiency of tax administration, provide for the imposition of Value Added Tax on certain mobile services and enhance the enforcement provisions in the Act and for related matters”.

He said contrary to popular belief, the imposition would not only affect cell phone calls, but all mobile transmitting services .

He said the range of services to be covered by the new levy included use of the Internet and other transmissions that facilitate email, Whatsapp, Skype and much more.

Sinckler said that the resulting revenue raised would go towards a soon-to-be announced university scholarship fund, replacing the bursary awards introduced last year as a measure to support students facing challenges to enter university owing to government’s withdrawal of fee support two years ago.