‘NETFLIX TAX’

An­tho­ny Wil­son

Con­sul­tant Busi­ness Ed­i­tor

an­tho­ny.wil­[email protected]

Min­is­ter of Fi­nance Dav­en­dranath Tan­coo has pro­posed a 12.5 per cent VAT on dig­i­tal ser­vices sup­plied by for­eign providers, which cur­rent­ly in­clude stream­ing plat­forms such as Net­flix, Hu­lu, Ap­pleTV, HBO Max and Dis­ney+, and a high­er sur­charge on high res­i­den­tial elec­tric­i­ty con­sump­tion. This in­tro­duces two ad­di­tion­al costs for house­holds in Trinidad and To­ba­go un­der the 2027 Bud­get.

The mea­sures form part of nine new rev­enue-rais­ing ini­tia­tives ex­pect­ed to gen­er­ate $1.18 bil­lion, de­spite re­peat­ed Gov­ern­ment as­sur­ances that house­hold elec­tric­i­ty rates would not rise and Prime Min­is­ter Kam­la Per­sad-Bisses­sar’s pre-bud­get de­c­la­ra­tion: “No tax­es.”

De­liv­er­ing the 2027 fis­cal year pack­age in Par­lia­ment yes­ter­day, Tan­coo an­nounced a $0.05-per-kilo­watt-hour sur­charge on res­i­den­tial elec­tric­i­ty con­sump­tion ex­ceed­ing 3,000 kilo­watt-hours over a two-month billing pe­ri­od.

Asked by Guardian Me­dia whether the fis­cal pack­age would in­clude any new tax­es out­side the Red House be­fore the bud­get pre­sen­ta­tion, how­ev­er, Per­sad-Bisses­sar had said, “No tax­es.”

Ex­plain­ing the pro­posed stream­ing tax, Tan­coo said many dig­i­tal ser­vices con­sumed in Trinidad and To­ba­go are sup­plied by busi­ness­es based out­side the coun­try.

“These en­ti­ties do not con­tribute to our coun­try’s in­come,” he said.

To fa­cil­i­tate com­pli­ance and col­lec­tion, he said Gov­ern­ment will in­tro­duce a sim­pli­fied reg­is­tra­tion process for non-res­i­dent sup­pli­ers. This will in­clude sup­pli­ers of tax­able ser­vices con­nect­ed with re­al prop­er­ty sit­u­at­ed in T&T, al­low­ing them to reg­is­ter, col­lect and re­mit VAT elec­tron­i­cal­ly.

“This mea­sure will broad­en our tax base, strength­en the col­lec­tion of VAT and pro­mote more con­sis­tent tax treat­ment be­tween ser­vices sup­plied from abroad and those sup­plied do­mes­ti­cal­ly,” Tan­coo said.

The stream­ing tax is ex­pect­ed to gen­er­ate $18 mil­lion in rev­enue and will take ef­fect on March 1, 2027.

Ac­cord­ing to Flix­Pa­trol, Net­flix had 162,500 sub­scribers in T&T at the end of De­cem­ber 2025, while Dis­ney+ had 118,440 sub­scribers as of Sep­tem­ber 2025.

Tan­coo said the elec­tric­i­ty sur­charge was in­tend­ed to en­cour­age en­er­gy con­ser­va­tion while sup­port­ing house­holds with low elec­tric­i­ty con­sump­tion.

He said the thresh­old of 3,000 kilo­watt-hours over a two-month billing pe­ri­od would en­sure that av­er­age house­holds with mod­er­ate elec­tric­i­ty us­age re­mained un­af­fect­ed.

“The rev­enue gen­er­at­ed from this sur­charge will help fi­nance the ex­ist­ing elec­tric­i­ty sub­sidy pro­vid­ed to house­holds with very low lev­els of elec­tric­i­ty con­sump­tion,” he said.

The sur­charge on res­i­den­tial house­holds is pro­ject­ed to gen­er­ate $17.8 mil­lion in rev­enue and will take ef­fect on Jan­u­ary 1, 2027.

The mea­sure comes de­spite re­peat­ed pledges by min­is­ters in the cur­rent ad­min­is­tra­tion that house­hold elec­tric­i­ty rates would not in­crease.

On May 3, 2025, the day the Cab­i­net was sworn in, Pub­lic Util­i­ties Min­is­ter Bar­ry Padarath pub­licly reaf­firmed a cam­paign promise to keep elec­tric­i­ty and wa­ter rates un­changed, re­ject­ing pre­vi­ous rec­om­men­da­tions by the Reg­u­lat­ed In­dus­tries Com­mis­sion (RIC) for tar­iff ad­just­ments.

A four-per­son house­hold in Ch­agua­nas that con­sumed 4,089 kilo­watt-hours of elec­tric­i­ty dur­ing Ju­ly and Au­gust paid $1,438.93. If the house­hold used the same amount of elec­tric­i­ty in Jan­u­ary and Feb­ru­ary 2027, its bill would rise to ap­prox­i­mate­ly $1,500, an in­crease of 4.23 per cent.

The Min­istry of Fi­nance ex­pects the nine rev­enue-rais­ing mea­sures to gen­er­ate $1.18 bil­lion in fis­cal 2027. The elec­tric­i­ty sur­charge and stream­ing tax ac­count for $35.8 mil­lion of that to­tal.

The mea­sures rep­re­sent ap­prox­i­mate­ly 1.97 per cent of the Gov­ern­ment’s pro­ject­ed rev­enue of $59.729 bil­lion for the fis­cal year.

Of the nine mea­sures, the Gov­ern­ment ex­pects a pro­posed lim­it on the use of car­ried-for­ward loss­es by busi­ness­es to gen­er­ate the most rev­enue, at $430 mil­lion.

“Our tax sys­tem must strike a bal­ance be­tween sup­port­ing busi­ness ac­tiv­i­ty and en­sur­ing that prof­itable en­ter­pris­es make a fair and time­ly con­tri­bu­tion to the rev­enues re­quired for our na­tion­al pri­or­i­ties,” Tan­coo said.

He ex­plained that busi­ness­es can cur­rent­ly car­ry for­ward ac­cu­mu­lat­ed loss­es to re­duce tax­able prof­its in sub­se­quent years.

While ac­knowl­edg­ing that the pro­vi­sion al­lows busi­ness­es to re­cov­er from pe­ri­ods of fi­nan­cial dif­fi­cul­ty, Tan­coo said the Gov­ern­ment be­lieved there should be an ap­pro­pri­ate lim­it on the amount of ac­cu­mu­lat­ed loss­es that could be ap­plied in any one year.

“Ac­cord­ing­ly, I pro­pose to lim­it the util­i­sa­tion of car­ried-for­ward loss­es for all busi­ness­es to 75 per cent of charge­able prof­its in any in­come year,” he said.