Saturday 26 September, 2020

Haughton moves to clarify his statements contradicting Peter Phillips

Dr Andre Haughton

Dr Andre Haughton

Opposition Senator, Dr Andre Haughton, has moved to clarify statements he made during the State of the Nation Debate in the Senate last Friday, during which he shot down a call by Opposition Leader, Dr Peter Phillips, for the Government to cut the General Consumption Tax (GCT) rate from 16.5 per cent to 14.5 per cent.

Phillips had made the call during a recent meeting of the National Executive Council (NEC) of the People’s National Party (PNP). He said it would ease the economic burden on ordinary Jamaicans.

Haughton, Spokesman on Planning and Development within the overall planning, development and defence portfolio of Phillips himself in the PNP’s recently-announced Shadow Cabinet, said in a statement on Wednesday that he never meant to disrespect the leadership of the party with his remarks, which raised more than a few eyebrows.

In a social media post, Haughton said his position was meant to “open discussion on the effective use of fiscal space, considering that we have water, healthcare and civil service issues.

“My points highlight that there is obviously a need for a reform to the tax system. We are faced with competing views, (including) the issue of equality and the need to stimulate economic activity,” Haughton added.

He conceded that his GCT comments “encroached on the party leadership and the Shadow Ministry of Finance,” but said “no disrespect was meant by it”.

The first-term senator has promised to take a different approach in the future.

“As a new member of the Shadow Cabinet, I was unaware of previous discussions and decision on tax policy, which falls in the portfolio(s) of the Leader of the Opposition and the Shadow Minister of Finance,” said Haughton. 

He said in the future, he intends to make himself available to internal party discussions so that he is not misunderstood.

Haughton is an economist and university lecturer.

While speaking in the Senate last Friday, he suggested that cutting the GCT rate by two percentage points was not worth it.

 He argued that it would cost the country far more than it would benefit individuals.

Opposition Leader, Dr Peter Phillips

He suggested that Phillips had made the call to “bait” the Government.

“There have been many talks and our party leader made some hints and tossed out a bait about reducing GCT by two per cent, and I heard Senator Sinclair, as well as Audley Shaw, talking about ‘we (the Government) are going to take this into consideration’, without breaking down the numbers. Mr President, instead of break down, let me break up the numbers,” Haughton said.

“If we are supposed to reduce GCT by two percentage points, moving from 16.5 to 14. 5 per cent, it will cost the country about $25 billion to $26 billion, assuming that every year we take $200 billion from GCT.

"Now, this two per cent is going to cost the country $26 billion. That is the average cost,” Haughton further suggested.

He said the savings that would accrue to individuals are minuscule.

“What is the benefit of the average consumer? I mean, if you buy something for $100, you pay $16.50 in GCT. You’re going to save $2. You buy something for $1,000, you might save $20. You buy something for $10,000, you are going to save $200. Then you going to buy something for $100,000, you will save 2,000.

“Now, is this saving significant enough to each Jamaican for us to sacrifice $26 billion to achieve? Is it? Is it? We have to think more carefully about what our objectives are,” he remarked to sustained applause from Government senators who reminded him that it was Phillips who called for the tax cut.

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