Grenada Waters Down National Reconstruction Levy

by Amanda Banks, Tax-News.com, London

24 January 2006

The Grenadian government has conceded some ground in its efforts to impose a new levy to help finance the cost of post-hurricane reconstruction amid strong opposition to the measure, particularly from trade unionists.

According to a report published by Caribbean Net News on Monday, the government has accepted the recommendations of the Grenada Chamber of Industry and Commerce by agreeing to reduce the National Reconstruction Levy to 3% for persons earning in excess of EC$1,000 per month (US$370) and up to EC$5,000 per month, but only for the first six months.

The government had originally proposed a levy of 5%, but the measure excited fierce opposition from the trade unions, and the Chamber of Industry and Commerce and the Conference of Churches of Grenada were recently invited to mediate in the politically charged dispute between the government and trade unionists.

However, all other aspects of the reconstruction levy will remain unchanged from the original proposals, meaning that individuals whose incomes range from EC$5,000 to EC$9,000 per month will make a flat contribution of EC$225 per month, and those earning in excess of EC$9,000 per month must make a flat contribution of EC$350 per month.

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