‘Withdraw the tax’
Holness warns Gov’t, says Opposition will resist transaction tariff
Andrew Holness yesterday told the Government that its intention to introduce the new financial transactions tax was a point of departure between the Administration and the Opposition, and advised the prime minister to withdraw it.
"Prime Minister, withdraw the tax, or else," Holness told Prime Minister Portia Simpson Miller across the aisle as he made his contribution to the 2014/15 budget debate at Gordon House.
Holness said that the Opposition was concerned that the tax would open the door to other "brazen and thoughtless tax impositions under the guise of passing some IMF test.
"It would be irresponsible of the Opposition to merely say we oppose the tax. We will resist the tax. This is now a point of departure," he said.
"Prime Minister, you claim to be looking out for the interest of the poor and vulnerable. In today's Jamaica, the poor and vulnerable use banks and ATMs. Remember, they have to cash their PATH cheques; they have to take their remittances from accounts they were encouraged to open," he insisted.
But, while the opposition leader was giving his warning inside the Parliament, there was speculation outside that the Government may be softening its position on imposing the controversial tax measure, which will affect consumers' withdrawals from deposit-taking institutions through electronic banking, point-of-sale transactions (debit/credit cards), cheques, Internet transfers and transactions involving ABMs/ATMs.
A news release from the Ministry of Finance and Planning said that Finance Minister Dr Peter Phillips indicated to trade union leaders that he will be conducting a review of the proposed revenue measures, and will announce adjustments, if any, by next Wednesday, when he is scheduled to close the annual budget debate at Gordon House.
Dr Phillips apparently made the promise at yesterday's monthly meeting of the tripartite committee monitoring the three-year MOU between the Government and the trade unions representing unionised public sector staff.
The MOU includes the current wage freeze and a $25,000 one-off payment to the workers in response to restrained inflation and job protection.
The release said that Phillips also reminded the trade unionists of the "precarious state to which the Jamaican economy had deteriorated, and the consensus that had been built around the demand for him to sign an agreement with the IMF, as quickly as possible".
"Minister Phillips acknowledged the sacrifices that have been made to get us to where we are now, by public sector workers who agreed to a further three years of wage restraint; by bondholders; by creditors; by pensioners; and others who agreed to lower returns on their investment in order to facilitate the reform effort," the finance ministry release said.
But Holness told the House of Representatives that the country could not let adversity blind it to opportunity, neither should crisis and desperation cause it to forego creative solutions.
"Making a sacrifice does not mean that people have to suffer. This is what is happening with this Government. The Government is not implementing creative solutions and taking smart decisions that will spur growth. It is not taking decisions that are fair to the people who are called on to make sacrifices, and most of all, it is not being true to its own call," the opposition leader said.
"The prime minister is calling on the Jamaican people to live within their means, yet the Administration she leads shows no solidarity, and are not leading by example in the belt-tightening. The Government continues to expand its cost to the people, with new vehicles, contracts, jobs and consultancies for the boys and girls; not to mention its massive travel bill," he stated.
"The finance minister is asking us to make a sacrifice, notwithstanding our already low standard of living, to pay for debt; much of which cannot be traced to any tangible benefit that could justify its incurrence; debt that was due to just bad policy and short-sighted decisions like Finsac and CAP," he said.