Deal or no deal: Grenada

Sandals Partnership Debunked by local newshounds

Said locals Akima Paul and Salisha Francis "This unreasonably large tax deal has done nothing more than to undercut local hoteliers and to create a precedent for investment opportunities- now that this deal is public, no other investor will be inclined to invest in Grenada for any less. Via this deal, our political leaders have essentially presented Grenada’s economically struggling rump for a very long and public ravaging."

"In an act screaming of blunderbuss and willful myopia, last weekend, the Government of Grenada saw it fit to award a multi-million dollar private enterprise (Sandals Resort International) a multiple tax break.  A tax break embodied as a sweetener of almost coma-inducing diabetic proportions in the name of development and job creation."

The pair continued:  "It was with a total suspension of belief that we both witnessed the Minister of Finance, a self professed economist; proudly boast of the "economic incentives" that would continue to line the pockets of Sandals for the next three decades.  Sandals’ own CEO confirmed the agreement between Sandals Resort International (SRI) and the government of Grenada by which the government of Grenada waives corporate taxes for 29 years, property taxes for 25 years, customs duties on all capital inputs for 25 years and an extension of the duty waiver on alcohol from the usual 15 to 25 years.  Cue series of exclamation marks. These waivers are return for the purported $100 million dollar investment SRI would be making in Grenada, which is a fallacy as would be explained."

They explained: "In layman’s terms (because taxation jargon is notoriously opaque) this means that Sandals pays zero taxes on all profits it makes in Grenada. For thirty years. Corporate tax stands at 30% so Grenada will lose 30% taxes on hundreds of millions of dollars. Further, the press release issued by Sandals also states that this alleged $100 million "investment" into La Source covers the cost of lands and additional property acquired from the Taylor family. This means the real "investment" figures are therefore much lower than the 100 million dollars advertised. So although the purchase of property comprises a significant part of the deal, Sandals will not even pay the 0.3% tax on the land it acquires or the 0.02% tax on its buildings; and it will not do so for any other land it acquires for 25 years. In addition, any equipment or structures that Sandals chooses to import will be duty-free for 25 years and it will be free to import as much alcohol as it wishes to for its all-inclusive guests, without duty, for 25 years. Even to those of us who do not profess to be economics graduates, this deal reeks of the word "mistake"."

Said the pair: "It certainly isn’t our intention to belittle an investment of $100 million US dollars (or rather far less, as earlier explained) in these tight economic times. Even with the promise of an additional 200 jobs raising rising to a headcount of 400 based on Sandals’ press release. Still the forbearance on the revenues given a waiver in this deal strikes as way too much given for way too little. Must we always genuflect before these gods of "foreign investment"? Without a doubt, with some ingenuity, creativity and imagination, our own local manufacturing and agro industries could be supported in a similar fashion to create much more than 200 jobs, and without requiring such deep tax cuts."

See the full article HERE

Reported by Valere Tjolle

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