Government introduces interest relief for outstanding school tax accounts

An initiative aimed at encouraging individuals with outstanding school tax arrears to settle their accounts was announced today by Loyola Sullivan, Minister of Finance and President of Treasury Board. The school tax interest relief is available to any individuals who have an outstanding school tax account with the Government of Newfoundland and Labrador and who voluntarily pay or make payment arrangements on the debt.

"Government has an obligation to collect monies owed to the provincial treasury, including outstanding school tax accounts. However, we recognize that in many instances the interest charges cause people to defer, or in some cases, not pay the outstanding debt," explained Minister Sullivan. "We are implementing this school tax interest relief initiative to encourage individuals to voluntarily re-pay the outstanding school tax balance."

The school tax interest relief is available to individuals who pay or make suitable payment arrangements for an outstanding school tax debt. Under the initiative, interest charges in excess of 36 months of interest accumulation will be waived (that is 36 months from when the account balance was transferred from the school tax authority to the Department of Finance).

Over the coming weeks, notification letters will be issued through the Canada Revenue Agency (CRA) to individuals with outstanding school tax accounts. The CRA has the most current mailing address data-base, making it possible to contact most individuals within the province and across the country, including those who may have re-located since the provincial government assumed responsibility for school tax.

The interest relief option is available until December 31, 2005. If individuals with outstanding school tax accounts do not make suitable payment arrangements prior to that date, the full balance of the school tax account will be required and the Department of Finance will proceed with collection efforts, including intercepting income tax refunds.

Minister Sullivan stressed that government does not want to cause any undue financial hardship in trying to collect monies owed to the province. "We must collect outstanding debts, but we must also ensure that in doing so, we are not inflicting unnecessary financial pressures on individuals," he said. "We recognize that some individuals are facing difficult financial situations, and the practice of reviewing cases in situations of economic hardship will continue. In these types of situations, eligible individuals may have the entire account balance waived."

Individuals wanting to inquire about the interest relief option can call toll free 1-877-729-5136, e-mail schooltax@gov.nl.ca or visit the department�s Web site at www.gov.nl.ca/fin

Media contact: Diane Keough, Communications, (709) 729-6830, 685-4401

2005 07 06                    1:15 p.m.