Dear Editor,

Prime Minister Andrew Holness, Finance Minister Audley Shaw and the Cabinet deserve commendations for successfully implementing the first phase of the $1.5 million income tax-free plan.

With the income tax threshold moving up to $1,000,272.00 on July 1, 2016 across the board, some 251,000 persons will directly benefit. The tax relief plan will allow PAYE workers to save substantial monthly funds and provide them with more disposable income in their pockets each month for spending in other areas they deem a priority.

This additional spending will have a positive multiplier effect on the Jamaican economy and constructively assist to grow the base of the economy.

Prominent income tax experts based in Jamaica and overseas have publicly articulated the view that Jamaica needs to progressively move in the direction of indirect taxation and abolish income tax, and I fully subscribe to that view.

Some of the wealthiest countries in the world that do not have income tax are: Bahamas, Bahrain, Bermuda, Cayman Islands, Kuwait, Monaco, Oman, Qatar, Saudi Arabia, British Virgin Islands, United Arab Emirates, Anguilla and Brunei.

There are some very shallow, puerile and warped thinking persons, including PNP propagandists, who have superciliously enunciated that the JLP Administration has failed to implement the $1.5 million tax-free plan, which the party fervently promised before the general election. However, that is patently fallacious, to put it bluntly.

When the JLP was voted into office it found out that the special gas tax fund was not available as those funds had already been transferred to the Consolidated Fund which the JLP had hoped would have been used to partially fund the tax-free plan.

As a result, the JLP determined that other taxes would be necessary in order to fund the tax- free plan. Therefore, the JLP has factually kept its general election promise by now implementing the plan in two phases, which powerfully demonstrates that the JLP Government is an honest one.

The International Monetary Fund has described the JLP tax plan as “a bold step to rebalance the tax system towards indirect taxation”.

Clearly, the IMF has given its official stamp of approval to the tax plan and the Cabinet deserves praise for presenting a well tabulated budget and a tax package which will have very little impact on inflation. The budget as presented by Shaw will have no negative effect on prices and goods produced in the country and instructively, it is anticipated that the SCT placed on petrol will have a 0.7 per cent impact on inflation.

Robert Dalley

St James

robertdalley1@hotmail.com