Jamaica: Opposition Blasts Fiscal Policy.

Sourced: Cananews.net

KINGSTON, Jamaica, Jun 1, CMC – Opposition Leader Andrew Holness has hit out at the government’s tax package, saying it is paraded as tax reform.

Holness, who unsuccessfully led the Jamaica Labour Party (JLP) into general elections last year,  told legislators that tax reform is necessary to increase compliance, and should be used not only for revenue enhancement but also as part of the country’s growth inducement strategy.

Contributing to the budget debate on Thursday, Holness, a former prime minister, urged the government to reconsider the taxes on books.

“Placing a tax on text books is not tax reform. The current Prime Minister, then opposition leader called us wicked for attempting to tax literacy when in our search for revenue we flirted with the idea.”

The Portia Simpson Miller administration said hopes to raise J$314 billion dollars (One Jamaica dollar = 0.012 US cents) in taxes during this fiscal year, as Finance Minister Dr. Peter Phillips last month gave lawmakers his plans to finance a spending bill that is twice the size of the tax haul.

Phillips told the House of Representatives a mix of taxes and borrowing would pay for a J$612-billion budget.

Holness said he was also objecting to the tax on animal feeds and seeds, claiming the move would effectively place an additional cost on agriculture.

“What really happens is that the small farmer has to treat GCT as an input cost.  Now effectively what you’ve done is to put another cost on agriculture.  The agriculture market is volatile.  It is susceptible to what the economists call exogenous shocks.”

During his contribution, Holness said the People’s National Party government had become the worst nightmare of Jamaicans.

He told legislators that the government should have taken the opportunity to implement tax reform which could induce growth instead of just implementing a tax package simply designed to raise revenue.

He said when he was served as prime minister his administration had started discussions about creating a comprehensive social protection programme.

The Opposition Leader is scheduled to hold a press conference on Friday.