The Private Sector Organisation of Jamaica (PSOJ) has assessed the recent tax package presented by the Jamaican Government and commends the move towards indirect taxation from direct taxation, as this will no doubt serve to address the compliance challenges faced over the years.
The PSOJ views compliance as the key to creating a reliable tax base, as well as a balanced society. The Government must therefore ensure that the Tax Authorities have all the resources necessary to bring about the high level of compliance required. A case in point is that there are approximately 112,000 registered tax payers for GCT, however in 2015, less than 11,000 filed returns.
It is essential that we broaden the tax burden and derive collection from a wider base. For this to be achieved, the Government must continue its move away from direct taxation by broadening the GCT base, which has been the recommended over the past few years. At the same time, the rates of consumption tax should also be reduced to compensate for this broadening while taking steps to widen the welfare payments through PATH, to ensure that those who need social protection are captured.
This approach needs to be taken in a considered and detailed way, to ensure that society as a whole benefits. Jamaica needs increased consumption; lowering of the rates in the future will reduce the costs of products which will increase the consumption leading to increased investment and subsequently job creation.
We note the increase in property taxes and we ask that in the future property taxes are indexed annually so as to avoid huge one off unpredictable increases that affect the planning of individuals and entities. We also note that compliance in property taxes is very low, at approximately 60% of the registered titles.
It is essential that the government uses it powers in tax collection, if we wish to improve compliance as well as see development throughout the country.
Contact: Ms. Jodi-Ann Reid, Marketing and Public Relations Officer
Tel: 927-6238 (Ext. 2051); Fax 978-2709