EFFECTS OF PROPERTY TAX

EFFECTS OF PROPERTY TAX

FUEL INCREASED 6 TIMES

In 2016, the price of super ($2.70) was increased by 15 per cent to $3.11. Diesel went up by the same percentage, climbing from $1.50 to $1.72.

In 2017, the price of diesel alone was touched. It was increased by another 15 per cent from $1.98 to $2.30.

In 2018, super gasoline increased from $3.58 to $3.97 per litre and diesel went up from $2.30 to $3.41 per litre.

In 2019, super climbed from $3.97 per litre to $4.97.

In April 2022, fuel was increased by a dollar across the board. Premium and super went up to $6.75 and $5.97 respectively and diesel went up by 50 cents to $3.91 per litre.

In October 2022, super and premium gasoline went up by $1 per litre, and diesel went up by 50 cents per litre. This means that for a litre, fuel costs $7.75 for premium gas, $6.97 for super gas and $4.41 for diesel.

Zero rated goods now carry 12.5% VAT
Plus 7% online Tax
30% Tax on used Tyres plus $20 disposal fee

A one bedroom apartment is between $2,000 - $3,000 rent. So an entire 3 bedroom house would be between $5,000 and $7,000 depends on location \

Houses can rent for: $5,000.00 per month
So, ‘Annual’ Rental Value = $60,000 ($5,000 x 12)
Annual Taxable Value (ATV) = 60,000 – 10% (for ‘voids’) ($6,000)= $54,000

Therefore,
ANNUAL PROPERTY TAX = $54,000 x 3% = $1620 per year, or
$135.00 PER MONTH

For a Pensioner living on $3,500.00 per month, that’s almost a 4% cut in their pension.
For a Disabled person living on $2,000.00 per month, that’s 6.75% cut in their disability grant.

For a CEPEP Worker earning $1,580.00 per month, that’s an 8.5% cut to their salary.

For a person earning $4,000.00 per month and renting a One bedroom apartment for $2,000.00 per month they are left with $2,000.00 to live on for the rest of the month to pay Phone, Electricity and Water bills plus food and traveling.

And if we do a basic calculation:
Phone: $220
Electricity: $300
Water: $100
Grocery: $1,000
Traveling: $125 per week, $125 x four week = $500
TOTAL = $2,120.00 -$120.00

So be it $81.00, $100.00 or $135.00 per month, some people just can’t afford it.

And I haven’t calculated the 5% commercial and 6% industrial tax ripple effect on consumers.

PROPERTY TAX: IF YOU ARE RENTING A SPACE IN A MALL

Space in Mall can rent for: $20,000.00 per month
So, ‘Annual’ Rental Value = $240,000 ($20,000 x 12)
Annual Taxable Value (ATV) = 240,000 – 10% (for ‘voids’) ($24,000)
= $216,000

Therefore,
ANNUAL PROPERTY TAX = $216,000 x 5% = $10,800 per year, or
$900 PER MONTH

PROPERTY TAX ON AN EMPTY WAREHOUSE

If you have an unoccupied Warehouse 40x80 in size 3200sqf
At a rental value of $3.50 per sqf (3.50x3200 = $11,200)
Warehouse can rent for: $11,200.00 per month
So, ‘Annual’ Rental Value = $134,400 ($11,200 x 12)
Annual Taxable Value (ATV) = 134,400 – 10% (for ‘voids’) ($13,440)
= $120,960

Therefore,
ANNUAL PROPERTY TAX = $120,960 x 5% = $6,048 per year, or
$504.00 PER MONTH

Given how slow business is now, someone with an EMPTY Warehouse will face a $504 monthly penalty.

PROPERTY TAX - ANNUAL RENTAL VALUE – VACANT LAND

The Annual Rental Value of vacant land will be found by taking a percentage of the Current Market Value of the land.
Commercial and Industrial 5%

For example if you have a Commercial or Industrial piece of land worth $5 Million dollars you subtract 5% (5,000,000 – 5% = $250,000) and then subtract 5% from $250,000 ($250,000 – 5% = $12,500)

Therefore,
ANNUAL PROPERTY TAX = $5,000,000 -5% = $250,000 -5% -$12,500 per year, or $1041.00 PER MONTH.

THE DONKEY LOGIC IN PROPERTY TAX

It is obvious the Property Tax will be passed on to the “consumer”

The government itself being a consumer, how much more it is going to cost the government for goods and services when Property Tax is applied?. I am sure it is going to be more than they are hoping to collect from Property Tax.

For example: Contractors would be taxed at 6% industrial rate, they would pass that rate on back to the government. PLUS the additional cost from their supplies . so a contract like the Manzanilla highway could easily go from $400 Million to $450 Million because of Property Tax, so the $500 Million the government is planning to collect from Property Tax could easily be wiped out.

PROPERTY TAX ON AN EMPTY WAREHOUSE


If you have an unoccupied Warehouse 40x80 in size 3200sqf
At a rental value of $3.50 per sqf (3.50x3200 = $11,200)
Warehouse can rent for: $11,200.00 per month
So, ‘Annual’ Rental Value = $134,400 ($11,200 x 12)
Annual Taxable Value (ATV) = 134,400 – 10% (for ‘voids’) ($13,440)
= $120,960

Therefore,
ANNUAL PROPERTY TAX = $120,960 x 5% = $6,048 per year, or
$504.00 PER MONTH

Given how slow business is now, someone with an EMPTY Warehouse will face a $504 monthly penalty.

FACTORS USED TO CALCULATE VALUE OF PROPERTY
• Location of the Property (Neighbourhood)
• Classification of the Property (Executive, Modern, Standard [I & II])
• Category of the Property (Agricultural, Commercial, Residential, Industrial)
• Dimensions – Property Floor Area
• Modifications to the particular property

THE DONKEY LOGIC IN PROPERTY TAX

It is obvious the Property Tax will be passed on to the “consumer”

The government itself being a consumer, how much more it is going to cost the government for goods and services when Property Tax is applied?. I am sure it is going to be more than they are hoping to collect from Property Tax.

For example: Contractors would be taxed at 6% industrial rate, they would pass that rate on back to the government. PLUS the additional cost from their supplies . so a contract like the Manzanilla highway could easily go from $400 Million to $450 Million because of Property Tax, so the $500 Million the government is planning to collect from Property Tax could easily be wiped out.

PROPERTY TAX - ANNUAL RENTAL VALUE – VACANT LAND

The Annual Rental Value of vacant land will be found by taking a percentage of the Current Market Value of the land.
Commercial and Industrial 5%

For example if you have a Commercial or Industrial piece of land worth $5 Million dollars you subtract 5% (5,000,000 – 5% = $250,000) and then subtract 5% from $250,000 ($250,000 – 5% = $12,500)

Therefore,
ANNUAL PROPERTY TAX = $5,000,000 -5% = $250,000 -5% -$12,500 per year, or $1041.00 PER MONTH

1- income Tax
2-Corporation Tax
3- Health Surcharge
4- N.I.S
5- V.A.T
6- Business Levy
7- Green Fund
8-Motor Vehicle Tax
9- Fuel Tax
10. Online Tax
11. Stamp Duty
12. Tyre Tax

- Property Tax