Parliament
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Tax Reform Important to Strategy to Enhance Business and Investment - PM
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KINGSTON (JIS):
Wednesday, April 23, 2008
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Prime Minister, Bruce Golding, has noted that improving the nation's tax system is an important part of the strategy to enhance the business and investment climate.
The Prime Minister, who was speaking during the 2008/09 Budget Debate in the House of Representatives today (April 22), said that this year, for "good reasons" the Government has not been able to embark on its commitment to a comprehensive tax reform programme.
"Much work has been done in developing the programme but some important work is left to be done. Because of the extraordinary economic circumstances we face this year, it would not be propitious to undertake a major tax overhaul, because the immediate impact on the revenues is difficult to predict with any certainty," Mr. Golding said.
"However, it remains a priority," he assured. "Our tax system is inequitable, inefficient and leaky. Average customs duty collections amount to only 5 per cent of the value of imports, one per cent of registered companies account for 75 per cent of corporate taxes, while 75 per cent of registered companies account for less than 1 per cent of corporate taxes," he stated.
The Prime Minister noted that 80 per cent of company taxes and 50 per cent of property taxes that should be collected are not being collected and apart from Pay As You Earn (PAYE) taxpayers, only 4,000 individuals are paying income tax.
He further informed that 250,000 persons who should be paying something are paying nothing, and for every $100 of revenue we collect, $60 goes back out in tax relief, waivers and concessions.
"We could significantly reduce taxes and collect significantly more taxes if everybody paid and this will be the aim of the comprehensive tax reform programme, which we intend to introduce next year," the Prime Minister stated.
"This year's Budget is predicated on a significant improvement in tax compliance. We have provided an amnesty period during which we will waive both penalties and interest. I urge delinquent taxpayers to take advantage of it," Mr. Golding stressed.
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