Mon | Sep 25, 2017

Daniel Thwaites | Suffering heart 'attax'

Published:Sunday | April 2, 2017 | 4:00 AM

I'm imagining that it's time for some kind of Consumer Affairs Commission geared towards politics and public policy. I'm thinking of the kind of place people can take a defective product so they can get some help in forcing the store to replace it.

Sometimes even an outright return might be appropriate, like if the pet parrot you ordered is delivered in a box - dead. It's been years, and I'm still hurt about that parrot.

But imagine there's a bunch of preachers walking around with the Prosperity Gospel, and you order their material and sign up for the five-year course. So you settle down to do the work, and you study the preaching and teachings. However, every time the blasted preacher keeps coming back to you for more.

All the while he's smiling and bawling, "Prrassssperity!" He's happy! But pretty soon you realise that the only one getting prosperous is the preacher. Plus, you discover that there are bills on top of bills you weren't expecting.

 

FINAL STRAW

 

The final straw is when the prosperity preacher tells you that you must surrender de bully beef, for there is no place for bully beef in the new kingdom.

Anyhow, this Political Consumer Affairs Commission will have to sensitise the public about false advertising, deceptive pricing, and fake sales and discounts.

False advertising is the use of misleading or outright false information to ensnare the consumer. Sound familiar? Well, I have $18,000 for the first reader to recall something like that. Woieeee!

Deceptive pricing? That's when sellers, who are really scammers, use deceptive means to convince consumers they're getting a bargain when they really are not.

Then there's the fake sale. It is when a seller says that an item is discounted, but really it isn't. Don't understand? Here's an example. You were just told that the property tax rate was going down. So now have a look at your property tax bill and get back to me.

By the way, I'm serious about this Political Consumer Affairs Commission. Think about it! Jamaican general elections are likely to devolve into a competition between various pitches about how to spend the money in the Supplemental Consolidated Fund once known as the National Housing Trust.

I know it would have sounded like a fanciful exaggeration to suggest this a decade ago, but it won't strike you as completely far-fetched today. Mark that as a sign of something that would have also been thought impossible a decade ago: that Jamaican politicians could further degrade their credibility. Yet it's happening right now.

At the time of the Budget, an astute rum bar analyst had actually told me: "Watch the property tax thing ... . Audley delay it so that people won't notice till dem go to pay ... . Remember our people don't look too far ahead enuh, so dem not seeing de fist ... but dem gwine bawl when de box reach dem!" It's a little late, but the box is landing.

And people are now connecting the increase to the 1.5 promise, and they're not thrilled about it.

The prosperity gospel is running into some stubborn facts on the ground. Similarly, the otherwise seamless messaging of the administration broke down when the PM and his finance minister were contradicting each other about the real reason for the NHT drawdown after Audley buss and said it was to fund the 1.5.

I heard Fayval Williams speaking on her radio station, and she was careful to emphasise that the property-tax changes are designed to be non-regressive, meaning that the poor are to pay proportionately less than the wealthy. When, one wondered, did this phobia for taxing the poor arise, and how deep does it run, when so many of the other taxes were so starkly regressive?

So let's look at it from a different angle as well, because we've all been through the list of new taxes, most of which are regressive to the core. Where not highly regressive, they ran against sound public policy, like encouraging people to buy health insurance.

And yet the one causing most upset is the most 'progressive' of the lot. Does that not strike you as odd? What does that tell you about our society? Or about who understands and pays attention? And who has mouthpieces and lobbyists and associations to champion their interests?

When the JHTA and JMA fly up in outrage, the administration will listen. Not so, when through fuel and electricity taxes, the burdens were shifted downwards to the people who weren't paying income taxes previously, but who now will be paying more for everything they consume.

 

THE IRONY

 

Again, I want to acknowledge the ironic and masterful arc of this whole train of events. In short order, over the course of the next few years, the Jamaican public will be told that since so few people actually pay income tax, it is no longer worth the cost of collecting. And so the supposed give-back will result in the terrible burden of income taxation being lifted off of the wealthiest taxpayers. You heard it here first, folks.

There was a better way of doing all this. In fact, as part of a structured system of reform, in which the transactional costs of buying and selling land would be reduced, a gradual increase in property taxes would make sense. Currently, we have a regime where property taxes are very low, but transactional costs very high, a combination that retards the growth of the property market, inhibits transactions, and fails to encourage real property to find it's most efficient uses. That is no bueno, and needs to be addressed urgently.

But this increase doesn't achieve any of that. This is just scraping every dollar out of the society to save political face. It is ketchy-shubby policy designed to wring dollars out of the people to hang on to the last wilting strand of credibility about the 1.5 election promise.

- Daniel Thwaites is an attorney-at-law. Email feedback to columns@gleanerjm.com.