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JAM | Mar 15, 2023

Opposition Leader rips into massive tax collection

/ Our Today

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… Claims Budget not for the people as standard of living being ravaged

Opposition Leader Mark Golding making his contribution to the 2023-2024 Budget Debate in the House of Representatives.

Durrant Pate/Contributor

Citing massive tax collection, particularly over the past two years, Opposition Leader Mark Golding has ripped into this heavy taxation at a time when the cost of living is so high, making it burdensome on the people of Jamaica.

Making his contribution to the 2023-2024 Budget Debate in the House of Representatives yesterday (March 14), Golding declared that the Budget, as presented by the Andrew Holness administration, is not for the people, saying the massive tax collection is “sucking the blood out of the people”.

According to Golding, “and what is worse, the Government’s Fiscal Policy Paper says it is collecting J$766 billion in taxes from the people this fiscal year. That is J$150 billion (or over 24 per cent) more taxes than the $616 billion it collected in the prior 2021-2022 fiscal year. It is also J$95 billion more than the J$671 billion in taxes it originally budgeted to collect for this fiscal year”.

Golding advised the Parliament that J$95 billion in surplus taxes will be collected from the people this year, above what was originally budgeted, noting that the Government projects that it will collect J$824 billion in taxes in the coming 2023-2024 fiscal year. This an increase in tax collections of over 34 per cent over the two fiscal years from April 2022 to March 9 2024.

Hollow is the refrain of ‘No new taxes’

Continuing, the Opposition Leader declared: “Thirty four per cent increase in taxes over just two years! An increase in taxes of J$208 billion! The massive increase in the amount of taxes collected from the people over the past two years brings to light just how hollow is the refrain of ‘no new taxes’ that was bellowed in this House, to the predictable but fundamentally empty beating of tables, last week Tuesday [when Finance Minister Dr Nigel Clarke made his opening presentation in the debate].”

The 34 per cent (J$208 billion) increase in taxes over the past two fiscal years is significantly greater than (nearly triple) the accumulated inflation over that two-year period, which is projected to be 12.3 per cent.

“These massive increases in taxes weren’t limited to the last two years, but if we look at the last seven fiscal years the tax take has increased from 24.4 per cent of GDP to 28.2 per cent of GDP, placing Jamaica amongst the highest taxed countries in the world.”

Opposition Leader Mark Golding

This represents 7.1 per cent in 2022-2023 and 5.2 per cent in 2023-2024. He made the point that this is coming in a period where people’s living standards are being ravaged by the cost-of-living increases.

For the Opposition Leader, “these massive increases in taxes weren’t limited to the last two years, but if we look at the last seven fiscal years the tax take has increased from 24.4 per cent of GDP to 28.2 per cent of GDP, placing Jamaica amongst the highest taxed countries in the world”.

He argued that, over the last seven years of the Jamaica Labour Party (JLP) administration, the tax-take from every Jamaican (15 years and older) has increased from J$197,000 in 2015-2016 to J$365,000 in 2022-2023, an increase of 85 per cent.

Opposition Leader Mark Golding making his contribution to the 2023-2024 Budget Debate in the House of Representatives.

The JLP administration, Golding charged, is now extracting an additional J$168,000 from the pockets of every Jamaican.

“Then they come with the samfie statement ’bout no new taxes,” the Opposition Leader decried.

Noting that the vast majority of the taxes in Jamaica are now indirect taxes, Golding remarked that the poor and lower income earners bear the brunt of it in the general consumption tax on local purchases (projected to increase by 31 per cent to J$156 billion in the coming year over what was originally budgeted for this year) and the taxes paid on the importation into Jamaica of basic necessities of life.

Capping gas tax proposal

He cited the ad valorem special consumption tax on gas, which was based on an average projected world oil price of US$67.50 for the year, reminding the Parliament that last year the Government was called on to give motorists, transport operators and electricity consumers a break on the ad valorem gas tax. The mechanism proposed was to cap the tax at the budgeted oil price of US$67.50, so that the people would not suffer any additional tax if and when the oil price went above US$67.50, and the fiscal targets for the year would not be affected.

“As it has turned out, the average oil price over this fiscal year has been above US$90.00, and the Government has benefitted from billions of dollars of gas tax by refusing to cap the tax at the budgeted price of US$67.50,” he said.

Golding added: “Well, since you didn’t listen last time and it has bitten everyone in their algorithms, please, for the sake of the Jamaican people, listen this time. Time come for a new direction.”

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