Prime Minister Philip J Pierre asserts that the country stands firmly on a strong economic footing, confidently tackling the challenges posed locally, regionally, and globally.
Reports confirm that under PM Pierre, Saint Lucia is undergoing significant economic transformation driven by sound policies. After experiencing economic declines from 2017 to 2019, the current leadership has successfully established a robust economic position.
This clearly indicates a shift towards positive economic growth and responsible management, effectively addressing the adversities of previous years. The Prime Minister’s leadership is a key factor in driving these transformative changes, emphasizing a commitment to economic stability and improvement.
During a media briefing on Monday, PM Pierre highlighted several vital Tax Relief amendments disclosed in this year’s Budget Statement, including crucial changes to the Income Tax Act. Importantly, payments to pensioners will be tax-exempt, providing them with the necessary support to meet their basic needs.
“These amendments to the Income Tax Act include an increase in the cap on annual deductions from $30,000 to $40,000,” he emphasized.
Moreover, he elaborated that this change excludes uncapped medical claims and includes provisions for Solar PV system components in 2025.
Additionally, PM Pierre noted an increased maximum child allowance from $5,000 per child under 18 years and a significant rise in the dependent relative allowance from $350 to $5,000. “Those caring for relatives can now claim $5,000 in compensation fees,” he stated.
The deduction for mortgage interest is now set at $40,000, with an increase in the deduction for Higher Education from $5,000 to $10,000, as well as an increase in the deduction for union shares to $10,000.
Saint Lucia’s strategic policy areas driving economic improvement and establishing a stronger footing include: Fiscal Consolidation and Debt Management:
– Proactive steps to reduce budget deficits and stabilize public debt via targeted spending controls, tax reforms, and enhanced revenue collection.
– Implementation of enhanced fiscal rules and medium-term expenditure frameworks to ensure predictable budgeting.
Tax Reform and Administration:
– Comprehensive reforms aimed at broadening the tax base, improving compliance, and simplifying the tax code to stimulate growth while safeguarding revenue. – Streamlined customs and VAT administration designed to minimize leakage and improve revenue efficiency.
Public Investment and Infrastructure:
– Strategic investments in roads, port facilities, energy projects, and digital infrastructure to enhance productivity and attract private investment.
– Projects financed through public-private partnerships (PPPs) or concessional financing to lower capital costs.
Tourism Diversification and Resilience:
– Execution of initiatives to diversify tourism offerings beyond traditional markets, including eco-tourism, cultural tourism, and niche experiences, ensuring sector resilience.
– Implementation of measures to address climate risks and improve disaster preparedness crucial to protecting the tourism sector.
Energy Security and Cost Reduction:
– Strong policies promoting renewable energy adoption and energy efficiency to decrease import bills and stabilize energy costs.
– Regulatory reforms specifically designed to attract investment in renewables and lower electricity prices for businesses and households.
Private Sector Development and Investment Climate:
– Simplification of business licensing, expedited permits, and robust anti-corruption measures to enhance the ease of doing business.
– Implementation of incentives for small and medium-sized enterprises (SMEs) and local manufacturing to diversify the economic base.
Social Protection and Human Capital:
– Comprehensive programs aimed at improving health, education, and workforce skills, aligning training with labor market requirements.
– Targeted social safety nets ensuring consumption maintenance while guaranteeing fiscal sustainability.
Exchange Rate and Monetary Policy Coordination: – Effective coordination between fiscal policy and monetary authorities to secure macroeconomic stability and maintain inflation control.
– Management of exchange rates to support competitiveness in tradable sectors.
Climate Resilience and Adaptation:
– Strategic policies to mitigate climate risks, protect essential assets, and support adaptation efforts in agriculture and infrastructure.
– Enhanced access to climate finance and disaster risk financing instruments.