Personal Perspective On The Trinidad and Tobago Property Tax Reform

November 20, 2009 by Taran Rampersad

When I went over the facts that were mailed out by the Ministry of Finance regarding Property Tax Reform, I immediately saw a few weak points from my own personal perspective. First, I have to give some background (without giving out too much personal information).

A Practical Look At The Old System

First, some basics. Private property (land, buildings) has an assessment number assigned to it. This is, for some idiotic reason, separate from the deed number associated with the property. To pay land and house taxes, one has to have that assessment number.

Last year, I inherited a sizable portion of land in South Oropouche. Part of it is tenanted, other areas are clear. The land was originally purchased by my grandparents; upon their deaths it was split between their 7 children. Thus the large parcel, which had one assessment number, was issued 7 different assessment numbers for the 7 different parcels of land approximately 10 years ago.

That's pretty straightforward. Where it gets complicated is when one considers the tenanted lands that my father inherited and which were then passed on to me. Thus, when the property was split seven ways with houses on the original parcel, the houses on each parcel were supposed to have been associated with their respective parcels. This was not done. It is unclear to me who was supposed to do what, whether the executors of the Will of my grandmother failed to do their jobs or whether the Board of Inland Revenue (Siparia) failed.

That said, for some peculiar reason, the 130 or so houses noted on the original property have not had their taxes paid for roughly 10 years. This year, the Board of Inland Revenue decided that they would place all those houses under my assessment number because they 'had nowhere else to put them'. This may be because I'm the most proactive landowner in the family, or it might be that they simply like the number 6. For whatever reason, they decided to place a lot of imaginary houses on my land.

But they're not on my land. So I went to the Board of Inland Revenue in Siparia with a list of the houses on my property, something my father and I had worked on. I was told that they didn't recognize any of the houses from their list - a list which is apparently almost 30 years old. In fact, almost none of the houses on the list I gave them were on their list! In a spirit of assistance, I offered to help them place the houses on the appropriate properties if they gave me the list. They told me 5 months ago that they would call me when they had it photocopied. They haven't called.

That same day, I was told that they couldn't take the houses off of my records because they had no place to put them. This, somehow, was something they thought should be my job. Thus, in the large volumes where they keep track of land records in Siparia, there's a bunch of poor documentation about my land that I seem powerless to do something about. Further, the woman who was assigned to work on the issue with me somehow became displaced - and they complained to me that they were understaffed. I was allowed to pay my land tax without paying the house taxes this year.

And, for the record, the 7 parcels now have many more houses than 130. This has been so for at least the last 20 years - and so no one stayed on top of it. Here I am trying to unravel this mess when property tax reform hits. But it gets more complicated.

Many of the houses started as chattel houses and were rebuilt as concrete houses without permission during the years prior. These are supposed to get approval from the Ministry of Planning Town and Country Division - and this was either not done, or the Town and Country Division of the Ministry of Planning simply didn't check to see if people owned the properties or not before giving approvals. My father mailed letters to Town and Country about the issue, but there was nothing done by Town and Country - not even a written response. Meanwhile, politicians in the area fanned the flames (and perhaps made a few dollars doing so). T&TEC, WASA, FLOW and TSTT were even sued by my father for planting poles without permission from the land owner - these I dropped upon his death for reasons of practicality. Since then, the same utility companies have become very proactive in assuring people have rights to be connected.

Then there is the issue of rents. Almost everyone on my land hasn't paid rent for about 8 years, something I'm working on as I am selling the tenants the lands that they are on for less than the legal requirement: The Laws require that I sell these tenants lands where their houses are for 50% of the valued price; I'm offering the sale for less - and they mostly still aren't buying (a few have).And the rents?  Those haven't changed since the 1960s in some cases - so the rents that the tenants have failed to pay are sometimes $100/year for a lot of land. Agricultural tenancies, which have been terminated on my parcel, were at $100/acre - and any attempt to raise the rents to more reasonable levels were thwarted by the Rent Assessment Board.

Further, people building without permission or who have to be evicted have to be taken to High Court - and lawyers love High Court cases because they charge a lot of money for them. One of my Uncles, a few years ago, spent $25,000 to stop someone from continuing their building of a house on his property. Clearly, land owners are expected to have deep pockets. The Police do nothing about these issues, either - they say that it is a civil matter, and so do nothing when people trespass upon your property. The systems and laws, put in place by the National Alliance for Reconstruction (whose members mainly populate the present UNC-A), only profit the lawyers and do nothing of substance for protecting property.

So what I inherited was, quite literally, a mess - a mess that persists to this day despite my best efforts. In the interim, I've had to prove to people on the land that my deed is good - politicians and lawyers had said that the deed the family had was not a real deed (!), and they profited by misinforming people in the area. My father was hit with the flat of a cutlass due to this combined with his own strategies that I disagreed with. To date, I've had death threats, slaps and attempts to intimidate me on my own property - all while trying to do what is required by Law as well as trying to be ethical in my dealings with tenants. They have Rights and I respect that; I have Rights and they are beginning to respect that.

Because of all of this and more, I have stayed silent about the Property Tax Reform. It could be a good thing. But the input to the system of calculating the property taxes this has my land with a lot of imaginary houses on it. Thus I'm concerned and trying to unravel that thread as quickly as possible.

So What Do I Think?

I think that the Property Tax Reform, despite my obvious problems with the imaginary houses on my land, has some potential:

• I like the Annual Rental Value (ARV) concept. If the government is going to come up with an annual rental value for the property, it means I may be able to adjust rents to more reasonable figures. Just driving around there during a day I can burn up $100 worth of diesel, not counting my own time and maintenance on the equipment. Thus I'm really interested in the ARV.
• The property taxes will be able to be paid at any District Revenue Office, all TTPOST payment outlets, through the ATM and telebanking through First Citizens Bank and Republic Bank.
• Since my land is zoned Agricultural by Town and Country, I don't have a problem with the amount of taxes changing - other than the number of imaginary houses on my property.

But there are obvious issues:

• A land owner could be taxed for a house that she or he didn't authorize to be built or modified - and so, the land owner becomes subject to the the value of a tenants house. Since the Laws of Trinidad and Tobago require costly court cases to handle this, it effectively screws owners of vacant land - not on its own, but by its context.
• The Town and Country of the Ministry of Planning has a lot of catching up to do.
• If the only inputs to the system are what exist in the books filled with assessment numbers in the District Revenue Offices, there will be many mistakes - such as the ones I expect to see after March of next year. I cannot see that I am an isolated case.
• People on fixed income (pension, retirement) do not have income that may be able to deal with the new system - so they will go into debt through no fault of their own.
• The increase in the Rents will cause problems for many unemployed and seasonally/agriculturally employed tenants.
• No contact information at the Ministry of Finance were given for dealing with problems such as I've described. I'll try their email (comm.finance_at_gov.tt) and see what happens.
• With things I have seen backlogged for at least 30 years, the coming years will be a true trial by fire of the new Property Tax Reform.

Overall, the new Property Tax Reform could be a good thing. But in context, it doesn't seem to address any problems that people have with the existing system - it seems like a redesign that only helps the government, not the citizens (just dealing with fixed income households alone!).

Permalink