Tuesday 26 May, 2020

It should have been a $30 billion tax break, says Mark Golding

Mark Golding

Mark Golding

Opposition Spokesman on Finance, Mark Golding, has asserted that the Government could have gone further by giving back an additional $16 billion in tax cuts on top of the $14 billion that was announced last week by Finance and the Public Service Minister, Dr Nigel Clarke.

According to Golding, the extra $16 billion could be given back if the Government was to cut the General Consumption Tax (GCT) from the current 16.5 per cent, or reduce the Special Consumption Tax (SCT) on fuel.

Clarke announced the $14 billion tax give back in his budget presentation last Thursday while opening the 2019-2020 Budget Debate. The measure will see a uniformed fee for stamp duty of $5,000 per transaction; the abolition of the $60,000 minimum business tax; and an increase in the threshold at which businesses become liable for paying GCT, from $3 million to $10 million.

But while welcoming the tax cuts, Golding, during his contribution to the Budget Debate on Tuesday, said the Government could have gone further without negatively affecting its fiscal targets.

“Mr Speaker, we estimate that $16 billion of additional taxes could be given up without reducing Government revenue in real terms… The Government could reduce the GCT rate from the 16.5 per cent where it is, to return that $16 billion to ordinary Jamaican consumers, and still see its revenue keep pace with inflation,” said Golding.

“The people would have greatly appreciated such ‘a ease up’ in the GCT. Or the Government could have reduced the $14 billion of SCT, the tax put on gas… they could have given the travelling public ‘a ease up’ from the high fuel prices,” Golding added.

“I’m talking about the taxi man and his passengers; the bike man doing deliveries; the truck man bringing in food from the country; the pensioners who have to buy gas out of their fixed income. All of them deserve a break from the heavy taxes,” Golding continued.

According to the opposition spokesman, “we must ask why the Government hasn’t shown some regard for the people and the burdens that they are bearing in determining how to direct the tax roll back.”

Meanwhile, Golding questioned whether the Government’s constant boast of a record 15 consecutive quarters of economic growth is in fact accurate. He said the claim, which was repeated by Dr Clarke last Thursday, is in conflict with statistics that have been put out by the Statistical Institute of Jamaica (STATIN).

The STATIN figures referred to by Golding show that for the fourth quarter of 2017, the country recorded negative growth of 0.8 per cent, and 0.4 per cent for the first quarter of 2018.

“This interpretation of the official data seems questionable,” said Golding.

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