Eyes on tax cheats: Credit bureaus closing in on delinquents' information
Daraine Luton, Senior Staff Reporter
TAX debtors who fail to honour their obligations to the State could find their credit ratings being significantly affected with the passage of a bill in the House of Representatives that would give the commissioner general of Tax Administration Jamaica (TAJ) the power to disclose their information to credit bureaus.
The bill, if approved by the House and Senate, would enhance the collection of taxes by amending various laws that provide for the collection of taxes.
Megan Deane, CEO of Creditinfo, a credit bureau, noted that the Credit Reporting Act made provision for the bureaus to collect tax information.
Deane said, however, that when credit bureaus approached tax authorities for the information, they were denied as the authorities cited provisions under the Revenue Administration Act that prevented the disclosure.
"Having acknowledged the debt, it will impact the debtor because how they treat with that information - in terms of paying it - will be one of the data sources that feed into the assessment of the probability of repayment as encapsulated in the credit score," Deane said.
The credit-reporting clause allows the commissioner or an officer of TAJ to disclose the identity of a tax debtor, and any money owed by the debtor, to credit bureaus under the Credit Reporting Act.
In piloting the bill through the House yesterday, Finance Minister Dr Peter Phillips gave the assurance that "steps [have been] put in place so that all rights of privacy of the tax debtor are not breached".
The Opposition requested more time to consider the bill, leaving the debate to be continued today.
Based on the bill, information may not be disclosed unless the tax debtor has acknowledged the amount owed, including by way of filing a return of tax, and has not paid the amount. Similarly, no disclosure can be made unless the time for making any objection or appeal in respect of the amount owed has expired and the money has not been paid.
In instances where a court has made a determination on the amount owed, and the funds have not been paid, the tax authorities are empowered to submit such information to credit bureaus.
Deane told The Gleaner yesterday that the tidying up of the law would allow for a fuller picture of a person's credit history to be presented as well as "how well they are honouring their obligation".
"It is not necessarily a penal thing because if people have made an agreement with the tax admin and they are holding to it and they are paying on time, it actually helps them on the credit score," Deane said.