A promise made by Finance Minister Winston Jordan that there will be no new taxes in Budget 2018 has received heavy criticism by Opposition Leader Dr Bharrat Jagdeo, who said the tax measures imposed in almost every productive sector by the coalition Government in 2015 is enough reasons not to introduce new taxes.
Jordan told the media in early October that support will instead be provided to small businesses, including miners and according to him, due consideration will be given to revising Value Added Tax (VAT) on education.
However, on Wednesday, Jagdeo recalled that before the new Government took office, miners did not have to pay Value Added tax (VAT) on machinery and equipment but now they have to. Their Tributors Tax was also increased by 100 per cent moving from 10 per cent to 20 per cent, and their final tax was increased by 40 per cent. Further, Jagdeo also noted that miners have to pay $2500 for every ounce of gold they declare.
“So let Jordan look at the miners in their faces and tell them that there will be no new taxes and there hasn’t been in the past three budgets. Let Jordan look at the rice farmers and say to them that land and water payments will no longer be increased,” the former Head of State lamented.
The Opposition Leader also alluded to the fact that people in the forestry sector are also being taxed. In addition, home builders now have to pay VAT on building materials; something that did not exist under the People’s Progressive Party (PPP) Administration.
While Minister Jordan promised not to introduce any new taxes, Jagdeo said there is a possibility that there could be increases in the current pool of taxes, something he hopes is not implemented given the already severe burden facing people.
Shifting his attention to President David Granger’s economic policy, Jagdeo, a trained economist, said the President is far from reality in terms of what is taking place on the ground. According to Jagdeo if persons are to travel around the length and breathe of Guyana like he has done, they will have a greater understanding of what is really taking place.
He said having spoken to Guyanese from all walks of life, regardless of political persuasion, race and religion, “you will find that there is a common worry about our future, the loss of welfare the loss of jobs and rising criminality and hopelessness.”
The Opposition has put forward a motion in Parliament seeking to have the Government reverse several tax measures. The motion calls for the restoration of the purchasing power of the people by removing the imposition of the Value Added Tax (VAT) on zero-rated items, new fees and licences, and an increase in taxes which were included in the 2016 and 2017 budgets.
The 3000-word long document extensively lists a number of measures that the parliamentary Opposition believes should be implemented to “stimulate the economy and reduce poverty and hardships.”
In that document, the PPP made recommendations for improvements to the tax framework, the finance sector, the business sector, infrastructural development, energy sector, education social services, health, agricultural sector, Amerindian welfare, the sugar industry, the rice sector, the mining sector, the transportation and communication sectors, and the security sector.
PPP Member of Parliament Irfaan Ali in whose name the motion was submitted, argued that the implementation of the recommended policies is critical to the creation of an environment more conducive to the growth and expansion of the economy, the creation of jobs, sending the right signals to the Private Sector, and, improving the welfare of the people.