Economist Dr Damien King has described Prime Minister Andrew Holness’ announced 53 per cent cut in the General Consumption Tax (GCT) on electricity as “a bad move from every angle”.

Set to take effect after the next Budget in March 2025, the GCT on the electricity component of a customer’s bill will move from 15 per cent to seven per cent.

Holness made the announcement as he addressed the public session of the 81st annual conference of the Jamaica Labour Party (JLP) at the National Arena in St Andrew on Sunday.

Some public commentators have already said the prime minister’s announcement is a mere general election ploy with the JLP trailing the Opposition People’s National Party in public opinion polls. The next general election is constitutionally due by September next year.

READ: Holness announces 53% reduction in GCT on electricity

Writing on the social media platform X on Monday, King said “…the election nonsense has begun”.

King pointed out that GCT on electricity is the “perfect tax”. He said it was impossible to evade, progressive since rich people pay more and “cheap to collect since TAJ (Tax Administration Jamaica) does nothing (to enforce the tax)”.

According to King “this will also disincentivise the transition to solar. A bad move from every angle”.

In making the announcement, the prime minister noted that up to 30 per cent of Jamaica Public Service Company (JPS) customers were unable to pay their electricity bills which contributes to electricity theft.

He said JPS will also remove the non-tax threshold and replace it with an “incentivised, compatible rebate of GCT for persons who use 200 megawatts of electricity or less per month”. This, he said, will allow for the roll out of pre-paid electricity purchase which the JPS will be required to implement nationally, but particularly in vulnerable communities.