Antigua PM willing to ‘collar’ Sandals over $30 million in taxes

Antigua and Barbuda Prime Minister Gaston Browne has accused Sandals Resorts of trying to get every concession from the government while paying as little tax as possible.

He levelled the accusation there as he said his government was preparing for a battle with the Caribbean multinational over EC$30 million in unpaid taxes.

Browne said on radio in Antigua that his country is attracting a significant amount of luxury properties.

“And I believe that is where it should be transitioning Antigua and Barbuda so that the yield for the country in terms of taxes will be higher, that the pay for the workers would be better, compared to these all-inclusive in which they continue to manipulate the accounts,” he said.

“In fact, we have an issue right now with Sandals. I think Inland Revenue has actually assessed them for $30 million in taxes that they have not paid. And I know it’s going to be another fight again.

“I don’t understand why these so-called investors feel that they’re the only game in town and they’re the only stakeholder that should benefit.

“So, they try to wring every ounce of revenue out of the business, and they don’t want the government to get nothing in the form of taxes. And I thought we have been through this with Sandals already and I don’t want to go down that road with them again. So, I want to appeal to them to please cooperate, because if we have to collar them again, we’ll collar them again.”

In 2016, Browne’s administration ended a 2009 agreement that allowed Sandals to retain 65% of the ABST collected from guests. The government said the arrangement was “illegal” and accused Sandals of withholding state funds.

Browne said Sandals had an issue in The Bahamas “in which certain things were done that were totally inappropriate, and they have to pay up some money, and everywhere they go, that’s their modus operandi”.

He said Sandals feels it has “a right to do whatever is necessary to just reduce, significantly reduce, government’s taxes, and they’re the ones who must continue to generate all these profits so they can expand”.

The Antiguan prime minister, however, had a message for his “dear friend” Adam Stewart, the chief executive of Sandals Resorts International.

“… is not Sandals is the only stakeholder when you open a hotel in the Caribbean countries. You have staff who deserve a good pay. You have the government that ought to get his fair share of taxes. You cannot just concentrate exclusively on exploiting concessions and to push governments into the ground,” Browne said.

“Y’all need to stop it. That kind of model, it is a slave model. It’s a colonialistic model that does not work for the Caribbean people.

“You need to step up. And I expect a brand like Sandals that we all admire as a Caribbean brand should feel proud that we making a significant contribution of government revenues and should feel proud that your workers can earn enough money to get a mortgage, to own a decent home, a decent car; not just about you expanding while others are struggling.

“We can’t even attract locals to work in the hotel sector because of the pay so small while you making tens of millions of dollars every year out of each of these small economies.”

Browne said that every time there is “a little assessment” about Sandals’ taxes, the resort comes up with “all kind of reasons why it should not be paying and charging inland revenue.

“I’m tired of it. When it comes to that nuh, if you can’t ensure that there’s an equitable dispensation going forward, where everybody benefit, if it is just Sandals alone to benefit, well, take your hotel elsewhere.

“And I’m dead serious. And I don’t want this matter to end up in the public domain like the last time because I don’t want to fight with you all. I want to fight with nobody; but you’re overdoing it.”

The prime minister said he was “shocked” when Inland Revenue told him that Sandals was not cooperating with the assessment.

“They want to take out all kind of deductions out of the ABST,” he said, referring to the Antigua and Barbuda Sales Tax.

“Is not they paying it nuh. They’re collecting the ABST from their customers, but at the same time, cause remember, they get all the corporation taxes off and the little ABST …

they put all kind of something in there about they advertise this and that cost and all kind of foolishness. I am just tired of Sandals; tired of them, tired,” he said.

Browne reiterated that he did not “necessarily want this matter to become a big public spat.

“But if it ends up being in a public spat again, if it’s one man that not going to recoil from any fight with them in the interest of the people of Antigua and Barbuda is me, and they ought to know that. And I hope they don’t try and test me,” Browne said.

“See, y’all need to settle up your bill. We need monies to fund the country and stop fighting Inland Revenue,” Browne said, adding that he did not tell the tax agency to assess Sandals.

“They did it on their own volition,” he said.

“But at the same time, Sandals just continue to play these games. And we know what these hotels do too. So, you know what they do, for example? They’re so bad minded and greedy.  If, for example, a tourist pays US$1000 a night, you know what they do?

“They have all kind of middle company in the United States and so on. So, by the time they report the money, report half. So instead of getting here 17% ABST on the 1000  — $170, you’re getting half, if you’re lucky.

“I mean, y’all gotta stop it and they behave as though we’re stupid. In fact, what we probably now need to do is start to have an arrangement with IRS in the United States and start to bring them to justice.

“Cause they’re under-reporting their revenues. And I’m speaking in general terms now. Bad mindedness. So, he’s like the government, not supposed to get nothing; they must get everything. And you know the last situation we had with them.”