Govt touts tax-free increases amidst reports of late payments to public servants

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Minister of Finance, Winston Jordan

Salary increases for public servants for the year 2018 will not only be retroactive to January 1, 2018, but also tax-free.

This was revealed when Finance Minister Winston Jordan on Friday gazetted the regulations under the Income Tax Act.

According to the gazette document, the Income Tax Act (Special Provisions) Regulations provides for the waiver of taxes on the retroactive percentage increase in salaries for public servants and public officers in the employ of the government.

Last week it was announced that the Finance Ministry of Finance approved 7 per cent salary increases for persons working up to $100,000 per month; 6.5 per cent for those working between $100,000 and $299,000 per month, and 5 per cent for those working for between $300,000 and $499,000 per month.

Additionally, persons earning from $500,000 and above $1M will be receiving increases ranging from 3 per cent to 0.5 per cent respectively.

Former Health Minister Dr Leslie Ramsammy

However, the touted tax-free increases are being overshadowed by unconfirmed reports that public servants have been advised that their salaries for November and December will be late.

This publication was informed that an advisory was sent out to the public servants informing them that the situation is due to ‘technical difficulties.’

It was also outlined that Public servants in various Ministries received their October payments late also.

Former Government Minister under the previous Administration, Dr Leslie Ramsammy who got wind of the situation questioned whether Finance Minister Jordan will hold a press conference to “explain the scandalous situation of late payments to public servants? Will he tell the nation what the technical difficulties are? Will he tell the nation who in the Ministry of Finance is responsible for the “technical difficulties”? Will he sanction anyone in his Ministry for violating national and international laws? Will the workers be paid with interest? There are many questions, indeed, and yet the David Granger-led APNU+AFC Government is behaving like this is a trivial matter. In fact, APNU+AFC is posturing that it is a ‘take it or leave it’ situation, with the workers having no choice but to be patient.”

Ramsammy is of the belief that there that the “technical difficulties” at the Ministry of Finance has to do with cash flow issues, due to mismanagement of the country’s economy and finances by the incumbent Administration.

General Secretary of GTUC, Lincoln Lewis

Meanwhile, Veteran trade unionist and Head of the Guyana Trade Union Congress (GTUC) Lincoln Lewis, while not commenting on the scale of the increases, had condemned the Administration for unilaterally imposing the increases, thereby dodging the process of collective bargaining.

The trade unionist said it is clear that they have moved away from that process which they promised and have now arbitrarily imposed increases without consultation with respective trade unions.

“And that is my concern. So long as there is an imposition it leads to endless problems in the relationship with trade unions and that is what this imposition can lead to.”

Lewis described it as blatant disrespect. Not only to trade unions but the coalition Government’s own commitment to the promises made to public servants countrywide.

“What they are doing, is throwing their own commitment outside, not respecting their manifesto promises to this nation. This is the most disrespectful act ever,” he said.

The GTUC leader feels the move taken by the David Granger-led Administration is one that is seeking to weaken trade unions representing public servants and the movement as a whole.

“That is the prime objective of the Government to say we (Government) are giving you and the trade unions have not done anything for you,” Lewis explained.

Similar views were expressed also by the Guyana Public Service Union (GPSU) on Wednesday last.

Observers also contend that the move by the Administration to provide tax-free increases is intended to appease the public servants, who were disgruntled with their governance and reflected same at the recently concluded Local Government Elections (LGE) where the People’s Progressive Party claimed 61 per cent of the votes, leaving APNU with 34 per cent and the AFC, who contested separately with 4 per cent.

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