Dear Editor, On March 20, 2013 the committee for Kingdom Relations of the Second Chamber met with Minister Plasterk about the financial situation of Bonaire, St. Eustatius and Saba; interesting figures.
The Dutch ministries have reserved a grand total of 230 million euro on their budgets for the islands. A lot of money, as one Member of Parliament (MP) stated about 10,000 euro per capita; another MP remarks that the Dutch government spends about 15,000 euro per capita in the European part of the Kingdom. The minister answers that, of course, money is garnered in the islands as well, about 60 million euro in taxes and premiums. The conclusion in the Chamber – the islands cost the Dutch taxpayer 170 million euro a year. This figure sticks to the memory of many people on both sides of the ocean. A lot of money isn’t it; we should be grateful that The Netherlands spend so much on us.
But, are those figures correct? I have seen so many figures by now, that I wonder which are correct. Recently, I submitted a request to the Tax Service for the Dutch Caribbean, together with Wietze Koopman, who writes about the new tax system. It was an official request based on the Law on Open Government to obtain the tax and premium figures for 2010, 2011, and 2012. This week we received the figures: the proceeds realised on a cash basis.
Let’s just go back to 2010. In the old Netherlands Antillean tax system the three islands provided the Netherlands Antilles with US $52 million a year. The deal was that in the new system the total revenue for the three islands should be about US $52 million as well. Moreover, the total tax burden (taxes and premiums) were to remain the same. But, in the summer of 2011, it showed that more tax money came in than expected – US $63 million instead of the originally estimated US $52 million.
State Secretary Weekers of Finance decided to ease the burden by nearly four million dollars and after inflation correction of another three million there was five million dollars for further tax cuts.
In the Second Chamber some politicians murmured about tax cuts. Why? Why should the extra revenue be returned to citizens and businesses on the BES islands? We have to spend a lot on the islands, too, don’t we? But, Weekers stood his ground; this was the deal that was made with the islands.
The figures we have received from the Tax Service show a juggling with numbers in The Hague. Staggering! Minister Plasterk has at least supplied incomplete information to the Second Chamber by mentioning US $60 million in tax and premium revenues on March 20.
What then are the revenues realised in 2011 and 2012? Fasten your seatbelts! The proceeds from taxes (direct and indirect) and premiums amounted in 2011 to US $112 million and US $117 million in 2012. Converted into euros (exchange rate 1.3) the BES islands brought 86 million and 90 million euros in the coffers of the government over the past two years.
I now understand why I have been wrestling for over two years with the figures. It looks like that from the beginning only the taxes (direct and indirect) were taken into account and that the premiums were left out of the equation. The discussions with politicians in The Hague on the ‘cost of living’ suddenly stand in a different light.
Citizens and businesses pay taxes and premiums not only to the national government; they also pay taxes imposed by local government, think of land lease and road tax. The total amount to be paid ‘to government’ is called the tax burden. What is it on the BES islands?
A year ago Bureau ECORYS did a study into the purchasing power. The researchers found that the tax burden on the three islands was considerably higher in 2011 than it was in previous years; it rose sharply from 25.7 per cent in 2010 to 32.6 per cent in 2011. ECORYS made use of provisional figures on tax revenues in 2011. Now we know what the real yield is, it shows that the tax burden in 2011 was even higher than determined by ECORYS – the correct figure is 33.8 per cent.
What does this mean? In 2010 out of every US $100, US $25.70 went to the government on the BES islands, and in 2011 from every US $100, US $33.80 went to the government; simultaneously, the prices also soared. In fact, this is in a nutshell the story of increasing poverty on the three islands.
A comparison sometimes helps to get a better picture. In 2011 the tax burden in the European Netherlands amounted to 37.2 per cent, 3.4 per cent higher than in the Caribbean Netherlands. But, European citizens in The Netherlands have housing benefit, child benefit, beautiful roads, tap water every day, sewage, public transport etc.
It’s downright shocking that a coordinating minister just blurts out anything when it comes to the finances of the BES islands. But, that isn’t the only thing; it seems the Members of Parliament couldn’t care less about previous administrative agreements. There is something seriously wrong!
Trix van Bennekom – TDH