The Dominica Co-operative Societies League Ltd. (DCSLL), the apex body for cooperatives in Dominica is very concerned about the Government’s stated intention to impose an astronomical credit union licensing fee as per its 2023 budget’s address. Whereas the DCSLL recognizes Government’s authority to enforce prescriptions of the Law, the stated fee structure will have grave impact on the growth, sustainability and viability of this home grown credit union movement.
This fiscal measure requiring credit unions to pay a license fee what is akin to a tax on their assets, is a crippling blow to the credit unions’ efforts to recover from Tropical Storm Erica, Hurricane Maria, COVID 19 Pandemic, IFRS 9 Adoption and the incidence of high Non- Performing Loans (NPLs). This is especially critical given the important role credit unions play in cushioning the harsh impact of these events. It is also important to note that none of the territories of the OECS and the wider CARICOM region has pursued this course of action, even in light of the prevailing economic challenges.
The DCSLL vehemently opposes this fiscal measure which is anti-growth and which stands to have a detrimental impact on credit unions. This draconian measure will take substantial resources out of the hands of credit union members both locally and in the diaspora. The League is therefore calling on the Minister of Finance to rethink this policy measure. While credit unions are not immune to the strong economic headwinds which face our country, taxing credit unions’ assets cannot be seen as a viable alternative to correcting fiscal challenges. It is important to reiterate that no other country in the CARICOM region charges any levy, license or tax of this magnitude on cooperative credit unions.
As at 2021, the credit union movement has disbursed more than EC$571 million in loans to its members which highlights the economic contribution which the cooperative movement makes to the economy.
The DCSLL therefore implores the Government to consider a more enabling and inclusive framework for the future growth of the movement and we avail to meet with the Minister of Finance at the earliest opportunity to discuss more viable and equitable alternatives.
About Dominica Cooperative Societies League Ltd
The Dominica Cooperative Societies League Ltd. is the Apex body for Cooperatives in Dominica and is responsible for advocacy, training, strategic development and marketing of its affiliates’ interest. The DCSLL has been in existence for over 65 years serving the sector. Our office can be located at 40 King George V St., Roseau, Commonwealth of Dominica. Additional details can be obtained by email at [email protected] or by phone 767-448-4416/4051.
