Barbados primed for huge shake-up of tax system after breaking from Royal Family

Prince Charles gives speech in Barbados at ceremony

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A Barbados official has suggested that the universal basic income could materialise as a “citizen’s dividend”. Avinash Persaud, the Prime Minister of Barbados’s Special Envoy on Investment and Financial Services, took to Facebook to hint at these plans which will build on the country’s pre-existing social infrastructure. Barbados’s current reverse tax credit is the country’s “first foray” into a universal basic income, according to Mr Persaud.

The reverse tax credit kicks in to add funds to a person’s salary if it does not reach a certain threshold.

Universal basic incomes guarantee each citizen in a country a certain quantity of money at determined points.

Mr Persaud raised the possibility that the “citizen’s dividend may be combined with the annual reverse tax credit to form some kind of universal basic income”, according to Barbados Today.

He said that Barbados’s Sovereign Wealth Fund will be adapted to make the Barbadian government’s assets “work for all Barbadians”.

He added that a slice of the income generated each year could be returned to the people of Barbados through a new initiative.

The principle of a citizen’s dividend is based on the idea that each and every citizen is entitled to profit from the successes of common resources.

He said: “The idea is that some of the income produced every year would be given back to all citizens over the age of 18, perhaps in the form of a citizen’s dividend.

“Over time the citizen’s dividend and reverse tax credit could form the basis of a universal basic income and create a greater sense of belonging to all of our people.

“We welcome other practical, effective ideas on how to achieve this goal quicker.”

He continued: “Barbados’ highly innovative reverse tax credit, introduced by the Owen Arthur Administration – the envy of many developed countries – was the first [foray] into a universal basic income. That was long the objective.

“Under the reverse tax credit, if your income is not above some basic level, the Government will top it up with a payment or reverse tax credit.”

“This is one of the practical ways a developing country could quickly get to the universal basic income. Therefore, it was regrettable that in 2016- 2017, the last Government stopped paying it – they said they had no money. But everything is a tradeoff.”

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Mr Persaud also praised the decision taken in 2018 to offer free higher education in Barbados, lauding the opportunities for “social mobility” and prosperity.

He said: “We are moving towards universal basic income across three fronts.”

He detailed: “Despite all the pressure from international agencies to ‘target’ we hold the line on universality. That’s why we restored free tertiary education for all.

“International studies have shown this is critical to social mobility and opportunity.

“The less well-off cannot take on the payments, risk and worry of getting heavily in debt to secure their future.”

This news comes as Barbados became the world’s newest republic at the start of December, removing the Queen as head of state and swearing-in Dame Sandra Mason as president.

The Queen’s son, Prince Charles, travelled to Bridgetown for the ceremony, addressing the crowd to say: “From the darkest days of our past and the appalling atrocity of slavery, which forever stains our history, people of this island forged their path with extraordinary fortitude.”

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