In a significant political development, former Finance Minister Camillo Gonsalves has characterized the recently implemented VAT-free shopping day as fundamentally illegal. The initiative, executed on December 19 by the newly elected New Democratic Party (NDP) administration, fulfilled a major campaign pledge but has now sparked serious constitutional concerns.
Gonsalves, who served in the previous Unity Labour Party (ULP) government that held power for 25 years before its electoral defeat in November 2020, articulated his position during an appearance on Star Radio, the ULP’s affiliated station. While emphasizing that his comments represented personal views rather than official party stance, the former minister delivered a detailed legal critique.
“I am not here to criticize the concept of a VAT-free day itself,” Gonsalves stated, acknowledging the government’s legitimate right to implement campaign promises. “However, I personally consider it more of a political gimmick than substantive help for vulnerable populations, primarily benefiting those with disposable income for major appliance purchases.”
The core of his argument rests on legal technicalities within the Value Added Tax Act. Gonsalves, leveraging his expertise as a legal professional, emphasized that “nothing in existing legislation authorizes any entity to suspend law arbitrarily. Simply declaring ‘no VAT today’ constitutes a violation of established statute.”
He proposed the proper legislative pathway would require parliamentary amendment to the VAT Act, specifically granting the Finance Minister authority to suspend VAT collection on specific items for designated periods through official Gazette publication. With the NDP commanding a supermajority of 14 out of 15 parliamentary seats, Gonsalves noted such amendment would face minimal opposition.
The former minister suggested political convenience motivated bypassing proper legislative channels, as the government sought rapid implementation before Christmas. This approach, he warned, creates “a tension between legal protocol and political sentiment” where “the decision was made at highest levels to ignore the law and legislate from cabinet.”
Gonsalves expanded his critique to address broader democratic concerns within Caribbean small island states, referencing similar supermajority situations in Barbados, Trinidad and Tobago, and St. Lucia. He cautioned against the regional trend of governing from cabinet rooms rather than through transparent parliamentary processes, emphasizing that “democracies are built on adherence to law, respect for majority, but protection of minority.”
While reiterating he wasn’t opposing the policy itself, Gonsalves concluded that “ignoring the law is a bad start even if the outcome is politically desirable. We are a country of laws founded on a Constitution, and we cannot bypass them when convenient.”