Portia faces tax!
PORTIA’S tax protests are necessary, but next time she must invite all citizens. Tax hurts PNP, JLP, voters, non-voters, and as the Cabinet is Jamaica’s, so too is Her Majesty’s Loyal Opposition. All citizens — not PNP members — pay the Opposition to do a job, and to oppose harsh taxes is spot on; go, Portia! She needs to be ready with options and tactics to channel citizens’ rage into winning moves. Now is the time to set an example, no more “same ole, same ole”! Strut your stuff, step up Ma’am, and “be the change”!
We feign shock at the Fitch downgrade. But we know our sick state needs the ICU or the IMF. Ireland, a role model, cut state spending by 20 per cent and state jobs by 15 per cent but we dawdle. Greece with debt of 120 per cent of GDP made harsh cuts too, faces riots and may be bailed out by the EU. Dubai was rescued by Abu Dhabi, a fellow UAE member. Our Caricom is strong on meetings, useless in wealth creation. We cuss Fitch. We won’t produce, curb imports, or pay taxes; we hit no runs so we blame the scorekeeper – what a laugh! Poverty is a cancer and the cure is as rough. Let’s take the medicine and live!
The truth is, our own citizens downgrade us too. Thanks to inept leaders, by the decade after 1962 we regretted giving up our British passports. We now have the world’s largest visa factory at Liguanea. Trus’ me, star, not just Dudus, every Jamaican is a flight risk!
Cabinet tells us it has to borrow from the IMF because the PNP got us into debt. Foolishness! If the cure for debt is to borrow more, then let’s all go to our banks now! How does $1.3b new debt help us pay off $1.2t old debt? We can solve our problem. We can live within our means, eat local, export and prosper by 2020. We can suffer to achieve or suffer for nothing. Choose! An IMF loan only delays the day of reckoning! We can go it alone!
Sovereign debt is a looming global crisis. The plight of Greece, Ireland, Italy, etc, says the world economy is very fragile. Iceland can default on its £5b debt as citizens don’t want to repay the small cash, but if Greece defaults on its £300b debt a new fault line opens. These nations know success and have problems. We know failure only. To default/defer our small debt is nothing. Our creditors know us; they rely on us to fail as we are the best borrowers for 48 years. But if we plan, are courageous and principled, our friends will respect us and help us along a self-reliant path. Cabinet, look at this option! Selah!
Tax is a bad word. Many are selfish and see tax as cruel, when it’s just their share of the nation’s costs. Few pay income tax, yet all enjoy the roads, etc. This is unfair! The crowds on TV cussing the police pay no taxes. The taxpayer is at work. Did you know most voters pay no income tax? And they have more say as to who is a member of parliament or councillor? Taxpayers need a champion in Parliament. The mantra of the American revolution, “No taxation without representation!” can be our rallying cry in 2010! Now, people, gather round for an income tax tale from the mythical island of Tiefness. “Once upon a time:
* In a population of 3m there are 1m children, 1.6m working age and 400k retired people. Some taxpayers are firms, they pay other taxes and Tiefness also borrows to survive.
* More than half the working-age group, say, 1m, is employed in some way.
* Half the employed, 500k (includes 120k civil servants and politicians), pay tax.
* The 1m employed aid the other 2m, so one worker supports self and two others.
* About 380k taxpayers aid the schools, hospitals, roads and pay 120k state workers. The ratio is one civil servant/politician to three taxpayers. Tiefness needs 45 MPs only!
* One taxpayer carries eight men, women and children. Brutal when compared with the UK, US and Canada. Is this fair? This is taxpayer hell! And they live happy ever after!”
“Tax smarts” is important. So, where’s the money? In uber profitable financial entities, entertainment, optional consumption and some dark places. How much income tax does a wealthy Tivoli Gardens “businessman” pay? Any guesses? Anything with a discrete ID and in a database – car, man, land – is easy to tax. We need a cradle-to-grave ID to ease the tax stress on the few and spread the burden. So, here’s some help for Bruce:
* Tax 101 must now be in the primary, secondary and tertiary curriculum. We must learn the nation’s fiscal chain — work, wages, tax, public services, a good life, happiness!
* A cradle-to-grave ID number given at birth by the RGD — cancelled only by death — and used for everything — school entry, licences, voting, security, tax, passports — is the key. This base allows PIOJ to know every age and sex cohort to plan housing, school places, jobs, health care, way in advance. In three years we can put everyone on the database.
* We need a tax Czar/CEO as the face, educator, missionary and enforcer to extend the tax base in all parishes. The commissioner would remain the technical head.
* We should retain bounty hunters on commission and pay citizens’ rewards to get new people into the tax net and uncover tax cheats by any means necessary. The czar will need secure email, text, voice line and funds to pay cash rewards to whistle-blowers.
* Our “tax tactics” should be to add new payers, reduce income tax and increase GCT in sync until income tax nears zero. We must tax pleasures, excesses, optional items — not basics. Tax a TV set at $800 per year. Some homes have a set in each room. By the same rule it is immoral to overtax cars when you do not provide good public transport.
* Integrate our tax system. When we input John Brown’s TRN and can retrieve his tax on wages, car, land, licences, permits, contracts won — all state transactions, taxes will flow.
* Do entertainment, sport, creative and culture icons pay tax? This sector earns billions. Do their incomes come here? What’s its percentage of GDP? Its income tax percentage? Now, how many MPs paid income tax before they were elected? Guess? More anon!
* We must use inductive and deductive tactics. My dentist’s home was maintained by tradesmen in return for dental work to their families. His accounts did not show one bag of cement, can of paint or contractor fees. Nuff said! Stay tax-conscious, my friend!
Dr Franklin Johnston is an international project manager with Teape-Johnston Consultants, currently on assignment in the UK.
franklinjohnston@hotmail.com