MINISTER of Finance and the Public Service Dr Nigel Clarke has accused Opposition Leader Mark Golding of disingenuous and "hypocritical" comments regarding the Government's 'no new taxes' budget.
Clarke argued that the Opposition, which had introduced its own 'no new taxes' budget five times during 22 years in power, understands what this means, especially in relation to tax revenue inflows, a correlation Clarke accused Golding of trying to obfuscate.
"When they do it once in a blue moon they want to be able to say no new taxes. We do it six years in a row and they want to trick the people; such hypocrisy because you know full well what no new taxes means, you know how tax revenue inflows can increase in an economy due to real gross domestic product (GDP) growth, due to inflation, due to normal GDP growth and other factors, even if there are no new taxes," he said.
Clarke pointed out that each time the Opposition People's National Party (PNP), when in Government, had introduced a new budget with no new taxes, tax revenue inflows did not remain flat.
"We have seen that happen on five occasions over the 22 years that the Opposition was in power. Despite no new taxes, tax revenues increased by 23 points in 1991, five points in 1996/97, six per cent in 2001, 16 per cent in 2004, and 15 per cent in 2006. That's normal and natural. Yet he [Golding] can stand here in Parliament and tell the Jamaican people that, because tax revenues have gone up, that no new taxes is 'samfie' business," he said.
Clarke said further that it was only five times in its last 22 years in power between 1989 and 2007 and between 2012 and 2016, that the PNP had no new taxes, which means that "17 of the 22 years it was in power it spent what the country did not have and heaped tax upon tax on the Jamaican people to make up the difference".
The finance minister said Golding's aim in his contribution to the budget debate last week was to "come here and try to confuse people as to what taxes look like". He added that the Opposition leader wants to confuse and trick the people with a kind of 'ginnalship', and pointed the finger instead on the "17 years of tax measures" under the PNP's management of the country.
Dr Clarke then dramatically rolled out connected sheets of paper to graphically show what 17 years of tax measures look like, stretching it across the chamber, with the help of parliamentarians, noting that half of it has not yet been distributed.
He admitted that, while times are hard and cost of living has gone up, it is also true that increased allocations to social systems programmes under this Government have risen as rapidly as revenues have.
"And it is also true that not only have we introduced no new taxes, but we have reduced taxes and introduced no new ones for six consecutive years," he said.
He said, as well, that the Government was tested going through a pandemic and losing 15 years of revenues or $75 billion.
"Unlike many governments in this region and around the the world, we took our commitment to people seriously and we managed the crisis and recovery without introducing any new taxes. In fact, we reduced taxes by reducing the General Consumption Tax (GCT) by 1.5 percentage points from 16.5 to 15 percentage points.
"With these examples, I am showing that, across time, it is normal and can be expected that, even when there are no new taxes introduced in a fiscal year, tax revenue inflows particularly increase over the prior year," he added.
Clarke said that while Golding made a "big hullabaloo" about increases in tax revenue inflows, "you can't run a country without inflows of tax revenues growing from one year to the next, and we are simply able to grow tax revenues without increasing taxes".
Said Clarke: "Tax revenue growth over seven years 2016/17 to what is projected for 2023/24 has increased by 80 per cent. But the budgetary allocation for school feeding for the same period has increased by 103 per cent faster than tax revenue growth. Allocations to the Poor Relief Department have increased by 90 per cent between 2016/17 and the budget for 2023/24, faster than tax revenue growth.
"With the introduction of the social pension, the allocations for all the social programmes in the Ministry of Labour and Social Securityâ€¦ increased collectively by 326 per cent faster than tax revenue growth. In fact, all Government social assistance programmes increased from $22 billion in 2016/17 to $40 billion in 2023/24, which is an increase of 80 per cent. So, as we get tax revenue for growth, we increase social support to the vulnerable," Clarke said.
- We welcome reader comments on the top stories of the day. Some comments may be republished on the website or in the newspaper; email addresses will not be published.
- Please understand that comments are moderated and it is not always possible to publish all that have been submitted. We will, however, try to publish comments that are representative of all received.
- We ask that comments are civil and free of libellous or hateful material. Also please stick to the topic under discussion.
- Please do not write in block capitals since this makes your comment hard to read.
- Please don't use the comments to advertise. However, our advertising department can be more than accommodating if emailed: email@example.com.
- If readers wish to report offensive comments, suggest a correction or share a story then please email: firstname.lastname@example.org.