Dear Editor,

I’m writing in response to a social media post made by one of Jamaica’s respected economists, Dr Damien King, on X formally Twitter on November 25, 2024.

Dr King’s recent criticism of Prime Minister Andrew Holness’s proposed 53 per cent cut in the General Consumption Tax (GCT) on electricity reflects a familiar pattern of scepticism he has exhibited in the past.

It is worth noting that Dr King is the same economist who, back in 2015, dismissed the Jamaica Labour Party’s (JLP) ‘1.5 tax break’ initiative as unworkable. At that time, he was proven wrong, and it is likely that history will repeat itself.

Dr King has characterised the GCT reduction as “a bad move from every angle”, suggesting that it will disincentivise the transition to solar energy and that it is a politically motivated manoeuvre ahead of the upcoming general election. However, his analysis overlooks the broader context of the current economic landscape in Jamaica, in which many citizens are struggling to pay their electricity bills. The prime minister’s initiative aims to alleviate some of this financial burden, particularly for the 30 per cent of Jamaica Public Service (JPS) customers unable to meet their electricity costs.

King’s assertion that the GCT on electricity is the “perfect tax” fails to consider the socio-economic realities faced by many Jamaicans. While it may be true that the GCT is difficult to evade, and relatively easy to collect, these attributes do not justify its continued imposition at such a high rate, especially when a significant portion of the population is in distress. The proposed reduction is a step towards making electricity more affordable and accessible, which is essential for stimulating economic growth and improving the quality of life for countless Jamaicans.

Moreover, Dr King’s concerns about the GCT cut discouraging the transition to solar energy are misplaced. The Government’s plan to replace the non-tax threshold with a rebate for lower electricity users indicates a commitment to supporting vulnerable communities while also incentivising renewable energy adoption. This dual approach could pave the way for a more sustainable energy future, rather than stifling it.

In conclusion, while Dr King is entitled to his opinion, like the JLP’s ‘1.5 tax’ initiative proved successful despite his scepticism, and the current proposal to reduce the GCT on electricity may very well yield positive outcomes for the Jamaican people. It is essential to remain open to innovative solutions that address pressing economic challenges, rather than clinging to outdated views that have already been proven wrong.

The Andrew Holness-led Administration has demonstrated the ability to listen to the cries of the people and respond appropriately. Dr King’s comments will likely not resonate well with the residents of Cornwall Court in Montego Bay or the hard-working people of Manley Meadows in St Andrew.

The true measure of a nation is how we treat the most vulnerable among us in society.

Christopher McCurdy

Kristophe60@hotmail.com