Modernizing Tax Administration, Cleaning Government Receivables, and Capturing Real Economic Activity Fairly

 To: Hon. Marinka J. Gumbs, Minister of Finance, Government of Sint Maarten

Cc: The Honorable Members of Parliament of Sint Maarten
Subject: Modernizing Tax Administration, Cleaning Government Receivables, and Capturing Real Economic Activity Fairly

Honorable Minister Gumbs,
Honorable Members of Parliament,

I address you publicly and respectfully because the situation has moved beyond private frustration and into a structural national problem.

For years, the public repeatedly hears that Sint Maarten “does not have enough money” to meet its obligations. I have stated on many occasions—publicly—that this is not the full truth. The island generates substantial economic activity. The deeper problem is that our collection systems and administrative processes are outdated, inefficient, and insufficiently equipped to fairly and consistently capture the taxes already due under our fiscal laws.

This letter is not written to attack any business sector or to single out hardworking operators. It is written to call for serious scrutiny and reform—because the current approach increasingly burdens those least able to carry the load, while large streams of turnover remain weakly captured, weakly verified, or effectively invisible.

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1) The Problem Is Not “Income.” The Problem Is Collection and Systems.

Our government systems—particularly within the Tax Administration and the Receivers Office (where applicable)—appear trapped in a cycle of:

chasing old and often unrealistic balances,
stressing ordinary people with accumulated back taxes, penalties, and administrative delays,
carrying accounts receivable that may not reflect collectible reality, and
failing to systematically verify real-time turnover in key sectors of our economy.

This creates a dangerous illusion: the public is told “we have no money,” while the island’s actual economic movement tells a different story.

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2) A Conservative Tourism Calculation That Raises Serious Questions

This morning I observed a full double-decker tour bus. This is a simple example, but it highlights a wider issue.

A conservative calculation:

approximately 70 persons on board,
at a net charge of USD 25 per person,
equals USD 1,750 per tour.

If that bus operates only 90 days per year (a conservative assumption), then:

USD 1,750 × 90 = USD 157,500 annual turnover (for one bus).
5% Turnover Tax (TOT) on USD 157,500 = USD 7,875 (for one bus).

Now multiply this across the many tour buses operating throughout the year—particularly on heavy cruise days when multiple ships are in port.

The core question is not complicated:

Are we reliably collecting Turnover Tax on tourism services provided in Sint Maarten—where the service is actually delivered—when the money is frequently paid abroad at booking, routed through intermediaries, foreign processors, and offshore structures?

If the answer is “not consistently,” then we must accept the consequence: the public treasury is leaking.

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3) Government Receivables Require Cleanup: Deceased Taxpayers, Closed Companies, and Non-Collectible Balances

A second major issue is that our governmental accounts receivable likely include balances that are not realistic. This can include:

tax assessments still outstanding for persons who have passed away,
companies that have gone out of business,
companies that have closed, and
entities that are simply not collectible due to time, insolvency, or lack of traceability.

This matters not only for collections but also for:

the credibility of budgets,
the accuracy of public financial reporting, and
the strategic focus of enforcement and audit capacity.

If receivables are not regularly assessed, cleaned, and categorized into collectible vs. non-collectible, then the system becomes bogged down and priorities become distorted. We end up spending limited capacity on old files, while present-day high-turnover activity continues with weak verification.

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4) High-Value Retail (Jewelry and Related Sectors): What Verification System Exists?

Another sector that demands serious attention is high-value retail—particularly jewelry and related luxury goods.

It is visibly evident that:

jewelry stores carry inventory worth millions,
individual pieces often sell for USD 10,000–20,000+,
tourists openly discuss purchases in the tens of thousands.

Therefore, the responsible question is:

What system does the government have in place to ensure this turnover is properly and fairly captured and taxed—consistently across the board—rather than relying on incomplete reporting, manual checks, or after-the-fact guesswork?

This is not an accusation. It is a governance question.

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5) The Gaming Sector: Cash-Based Casinos, Verification, and Social Harm

In addition to tourism and retail, we must address another major sector on the island: gaming.

Sint Maarten has a significant casino community. In principle, this is a cash-driven sector. That raises two governance responsibilities which cannot be ignored:

(a) Fiscal responsibility: accurate capture of gaming-related turnover and obligations

In a cash-based sector, the central question becomes:

What systems do we have in place to accurately control how much casinos take in—and how much they actually report?

Cash-heavy industries require stronger verification, not weaker. If our systems are outdated, then under-reporting becomes easy, and enforcement becomes selective and inconsistent.

(b) Social responsibility: protecting our local population from gambling addiction

Gambling addiction can destroy households and communities in ways that mirror drug and alcohol addiction:

financial collapse,
family instability,
mental health deterioration,
criminal spillover, and
long-term poverty cycles.

So the question is also:

Who is measuring and addressing the harm that gambling addiction causes among our local population, and what practical safeguards exist beyond words?

(c) The role of the government controller at casinos

It is commonly known that each casino has a government controller at the door.

Therefore, I ask plainly and respectfully:

What are the controller’s official duties?
What are the controller’s measurable responsibilities regarding compliance, reporting, and oversight?
What is the reporting line—who checks the controller’s work and what is the documentation trail?

Because, from my direct observation, I have often seen these controllers doing nothing more than standing at the door while collecting a salary, without visibly carrying out a specific duty. If that observation reflects the reality, then the island is paying for oversight that does not actually oversee.

If the duties are being performed—but not visible—then the government should publish the duty framework, reporting requirements, and accountability mechanism so the public can understand what oversight exists in practice.

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6) The Operational Reality: Weak Administration, Weak Traceability, Weak Audit Capability

In many sectors beyond luxury retail—shops, groceries, and other operations generating millions annually—the practical reality is that:

some businesses do not use robust point-of-sale systems,
receipts may show only totals without itemization,
bookkeeping and inventory control are often incomplete,
cash handling can be opaque, and
banking deposits may not reflect total cash turnover.

In such an environment, the government lacks a reliable method to verify even approximate accuracy within a reasonable margin (5–10%), and in my professional opinion it is highly unlikely that we are consistently within that range across the economy.

Without traceability from:

purchase → inventory → pricing → sales → deposits/cash handling → reported turnover → tax due,

audit and enforcement becomes reactive, labor-intensive, inconsistent, and prone to both under-collection and unfair targeting.

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7) The Social Consequence: The Small Man Carries the Burden

The most troubling outcome is that the burden becomes concentrated on people who cannot avoid it—particularly wage earners and small, visible operators—because they are easiest to trace and tax.

Minimum-wage workers already face the harsh arithmetic of island life: rent, utilities, and food costs make survival extremely difficult. They cannot “structure around” their wage taxes.

If the government continues to squeeze the most traceable citizens while failing to modernize systems to capture broader economic activity fairly, the outcome will be:

rising hardship,
rising resentment, and
declining trust in governance.

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8) Request to the Minister and Parliament: Oversight, Metrics, and a Modernization Plan

I respectfully call on the Minister of Finance and the Parliament of Sint Maarten to take urgent, measurable steps. At minimum, I request:

A structured receivables cleanup and classification program
collectible vs. non-collectible segmentation,
removal/closure of deceased and closed-company balances where appropriate,
realistic receivables reporting for budgeting and financial statements.
A modernization plan for real-time turnover verification
especially for tourism-linked services paid abroad but delivered locally,
and for high-value retail sectors.
Gaming sector oversight transparency and accountability
publish the role, duties, and reporting requirements of government casino controllers,
establish measurable oversight outputs (logs, compliance checks, reporting frequency),
ensure consistent verification systems appropriate for cash-based gaming activity,
and integrate public health safeguards addressing gambling addiction.
Publication of performance metrics (quarterly) such as:
TOT collection trends by sector,
aged receivables distribution and write-off policy,
audit coverage and outcomes (aggregated),
compliance improvement targets.
A fairness principle in enforcement:
modernization first,
better verification systems,
reduced reliance on punitive pressure against low-income wage earners and micro-operators.

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Closing

Honorable Minister and Members of Parliament: Sint Maarten does not lack economic activity. What we lack—urgently—is a modern, verifiable, efficient system that collects what the law already requires, fairly and consistently.

If we do not address this, the cycle will continue: unrealistic receivables, weak verification, selective enforcement, and constant claims of “no money,” while the real economy remains under-captured.

I submit this letter respectfully, but firmly, in the interest of the country.

Respectfully,