The 2017-2018 Tax Measures
The recent tax measures announced in the 2017-2018 Budget Debate have not found favor with some and it is all the more reason why the Jamaican business community should step up its efforts in support of comprehensive taxation reform.
As Chamber members know, this has been a consistent plank on the JCC’s platform of issues in support of economic growth for decades now.
The unfortunate truth is that we have had the experience, with successive administrations, where Cabinets emphasizes their willingness to do so, but end up cherry-picking components that accord with their short-term budgetary imperatives. The limitations of such a stance are evident.
Our focus cannot simply be how we fill this year’s budgetary hole – taxation decisions should also address the medium and long term if they are to achieve their intention.
A medium to long-term perspective on the part of governments on either side of the aisle would have ensured that Property Tax would not have jumped from a 2002 valuation to a 2013 valuation.
It is not rocket science to introduce an indexed valuation mechanism that sees incremental increases rather than a much larger jump a decade down the road. It would also have meant that over the years we would have in one place, a registry of every parcel of land for which a title exists and the Valuation could be adjusted more regularly.
A medium-to long term perspective would have removed the issue of continuing incentives for the Junior Market from political debate to an acknowledgement that the imperative to grow the size of the national pie moreso than imposing additional burdens on an economy that has grown on average a little more than 1% annually over the 54 years of independence.
We can tax less and grow more!
As it is, and if we strip away some of the rhetoric for and against the movement of resources into the Consolidated Fund, we must acknowledge that from time immemorial successive administrations have utilized funds earmarked for particular activities – dating back to
• the Bauxite Levy
• the Education Tax
• the NHT Funds
• and the proposed use of the Tourism Enhancement Fund – to prop up the budget.
The fact is that the unwillingness to look beyond the short term over these many years, has taken us to a point where there are very few options.
What we must insist on is rationality in tax measures and efficiency in ensuring compliance.
What we must ensure is that our national budgets have the scope to deploy resources to meet extraordinary circumstances.
It is not beyond our capacity to put in place a fair, efficient and forward looking tax regime.
B. Larry Watson, President, Jamaica Chamber of Commerce