– Ali says $1B in water, $5B in electricity would be taxed from the ordinary man
By Ramona Luthi
As the debates regarding the 2017 Budget began earlier today, Chairman of the Parliamentary Public Accounts Committee (PAC), Former Housing Minister and now Shadow Finance Minister, Irfaan Ali was the first to begin the charge for the Government to withdraw the proposed Budget.
According to Ali, the budget is laced with inaccuracies in regards to the economic performance of the country and is completely inundated with too many taxes that would spell doom for Guyanese.
He asserted that the presentation that was done by Minister of Finance, Winston Jordan last Monday held no initiative that would enhance the country’s already decreasing economy or provide betterment for the citizens.
He reiterated many times during his speech that the 2017 National Budget lacked measures to “green” and diversify the economy.
Ali confidently asserted that along with his presentation, the outcry of many significant organisations including the Private Sector, Labour and from Civil Society, held sufficient evidence to convince the coalition administration to withdraw the budget.
Additionally, he suggested that the administration sit with the People’s Progressive Party/Civic and craft a better budget.
This suggestion was encouraged by many members of the Opposition PPP/C in Parliament as chants of “withdraw” broke out among them.
The Parliamentarian condemned the APNU/AFC government for their proposed taxation measures which included the 14 per cent Value Added Tax (VAT) to be charged on electricity, water and other items which were once zero-rated or exempted.
In accordance to what was uttered by the Private Sector last week, Ali stated that these tax measures will pose challenges as he pointed to early estimates released by the National Milling Company of $200M in losses annually since VAT inputs can only be recovered when items are sold as zero rated and not tax exempted.
Ali also noted that approximately $1B will be extracted through the taxing of water alone- money that is being taken from the average persons. His calculations also predicted that more than $5B will be taken away from the ordinary citizen in relation to taxes on electricity.
Run on the dollar
He continued to lambaste the incumbent administration for their proposal to allow the Guyana Revenue Authority (GRA) access to the private bank accounts of citizens in an effort to redeem money that they [GRA] say is owed to them. The former Minister noted that this could trigger a “run on the local banking system,” as tax payers will be inclined to remove their monies from the banking system altogether.
Ali further questioned the motives of the administration to compete with the private sector for finances, highlighting that this will only result in mopping up available liquidity.
“Who will suffer? It is the people of the country that will have to face the brunt of the increases.”
He said too that to impose an Environmental Tax will have devastating effects on the local manufacturers, recalling that when the matter was broached some years ago, two significant Ministers were at the forefront rejecting the imposition of a $10 tax on the importations and manufacturing of items produced in bottles, tins and so on.
According to Ali, for this to be implemented, it will result in another $1B being taken from the ordinary man through the imposition of tax on soft drinks and bottled water, which will once again contribute to the decrease in disposable income.