News & Current Affairs, CARICOM Affairs - Thursday, December 17, 2009 19:22

Jamaican government imposes new taxes ahead of holiday season

By Antillean, News Desk

Editor’s note: Following public outcry, Prime Minister Bruce Golding has changed this tax package. Please click here for further details

On the eve of the Christmas holiday, the Jamaican government has announced new taxes which will become effective from January 1, 2010.

Speaking in parliament today, Finance Minister Audley Shaw revealed that General Consumption Tax (GCT) will increase from 16.5 per cent to 17.5 per cent, with the aim of raising JA$3.6 billion for the government.

The Special Consumption Tax on cigarettes will also be increased from JA$8,500 per 1,000 sticks to JA$10,500 per 1,000 sticks to raise JA$1.41 billion, while the controversial gas tax will be increased to 15 per cent to raise JA$ 9.4 billion.

GCT will now also be applied to electricity, but only for residential customers who use more than 200 kilowatt hours each month, and this is expected to raise a further JA$1.2 billion for the government.

A number of items previously exempted from GCT are also now being taxed, including: fresh fruit and vegetables, ground provisions, banana, onion, garlic, meat, poultry, fish, corned beef and pickled mackerel. Canned sardines, mackerel, bread, buns and bullas will also now be taxed, in addition to medical and surgical prostheses and orthopedic appliances. PM Golding has also hinted that there may be an increase in property taxes come April 1, 2010.

Finance Minister Shaw said the tax increase was unavoidable at this time, and are aimed to earn the government an additional JA$ 21.8 billion per year.

The current tax measures are expected to raise JA$5.4 billion by the end of the fiscal year in April 2010, however the government has indicated that it needs to raise JA$10 billion to fill the current deficit. The finance minister however has not said how the additional JA$4.6 billion was to be raised.

Earlier today, media reports indicated that more taxes may be announced after the Jamaican government signs a funding agreement with the International Monetary Fund in 2010.

Related articles:

  1. New taxes for Jamaica immediately after IMF deal
  2. Jamaica: Subdued tax protests ahead of Opposition’s budget reply
  3. Jamaican finance Minister Shaw presents Government’s budget
  4. Jamaica reshapes tax package after public outcry
  5. Full summary of the Government of Barbados’ 2009/10 budget

Antillean · Bridgetown, Barbados

The Antillean is a pan-Caribbean nonprofit media outlet, covering news, features and opinions on social issues in the Caribbean region and the wider Americas. Our mission is to encourage conversation on, and enhance the visibility of, social currencies within the hemisphere – issues which are often underreported in the mainstream media.

info@antillean.org

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Jamaica Anonymous from Saint Andrew, Jamaica
Dec 18, 2009 14:44

the new tax measures was expected-it is cruel to expect the Jamaica people to tighten their belts any further. For years upon years we are called on to sacrifice and no better has come. Inflation devaluation corruption high interest rates are the order of the dayin excessof30 yeras. WethepeopleofJamaica have not benefitted. There isno growth in the economy/ children still government high schools illerate and without life skills. we pay forproper education of our childrenthere is no future for thise children with university education.

Banks continue to make /cream off massive profits repatriating vast profits to foreign lands all on the backsof the Jamaican people. the high interest rate regime has stifled growth. we are indeed on a rapidly sinking ship.merry christmas from a sufferer.

Barbados JEAN H. from Saint Michael, Barbados
Dec 19, 2009 18:44

What a sad day for such a beautiful Island. Amazing how the planners can only see an increase in taxes as a resolution to the economic problem. We must go back to the initial frame work to support the Island. For example:
• The people must return to the soil
• The government must provide jobs for its people
• Uncultivated land must be cultivated to produce food stuff for the local people as well as for export.
• Tourism must be promoted and local citizens educated in customer service skills as mentioned by another writer.
• Returning residents who are vacationers must be treated with respect and not disdain as they vacation on the Island by choice and not take their financial resources elsewhere.

Economic crisis exist globally and there is no sign of tax increase by other Caribbean Island to sink their citizens further into poverty. TAX INCREASE IS NOT THE ANSWER AT THIS TIME. Figure out how to decrease imports and increase exports. An Island that cannot feed its people without dependence on imported goods must re-evaluate its plans. Infrastructure such as roads, water, electricity, bridges must be a priority to get the citizens moving from point A to point B as well as transporting the produce from hard fetch areas to the marketplace.

No doubt the will of many citizens have been broken by this devastating new of a tax increase on basic food items. Jamaica cannot adopt the lifestyle of countries such as the USA. Basic food items are not taxed in the USA so its citizens will always be able to buy basic food items without heavy taxation. I am sure the citizens are crying out for mercy as they face the New Year. With the new taxes please also develop a plan to put the people to work so that such tax burden can be alleviated; also consider lifting the taxes from basic food items so that the citizens can retain the dignity of providing for themselves. Remember why the people voted you as their leaders because they believe in your honesty and that you were capable of pulling the country out of the rut and put it back on the right track. Both parties must come together and plan for the betterment of the Island and not destroy the good ideas from either side of the Isle.

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