Drop in the bucket - Golding says majority of J’cans get crumbs from $14b stimulus Budget
Opposition spokesman on Finance Mark Golding has ridiculed the Government’s $14-billion stimulus package, charging that it provides incentives mainly for the rich, but nothing for the “vast majority” of Jamaicans in inner-city communities scattered across several constituencies, including the one represented by Prime Minister Andrew Holness.
Further, Golding mocked the projected $4-billion increase in the budget for persons on the Programme of Advancement Through Health and Education (PATH), saying it equates to $226 per week or $32 per day for each of the 340,000 beneficiaries.
“It is a drop in the bucket and represents mere crumbs from the minister’s table,” he said, making reference to Finance and Public Service Minister Dr Nigel Clarke.
“It can’t even buy a patty. It can’t buy a bun and cheese. We cannot see how, if we are to be honest, $32 per day amounts to any prioritisation of the interest of the poorest and most vulnerable,” added Golding, as he made his contribution to the 2019-2020 Budget Debate in the House of Representatives yesterday.
But the opposition spokesman reserved his harshest criticisms for the tax give-back, which he argued could not deliver the equity promised by Clarke.
“The current approach of providing incentives mainly to the owners of capital and wealth in the hope of benefits trickling down to the have-nots is repressive and does not serve the interest of the vast majority of the Jamaican people,” he lamented.
Under the $14-billion stimulus package, a total of 3,500 businesses will no longer have to file returns on general consumption tax (GCT). The reporting threshold has been increased to $10 million, up from $3 million, costing the Government $731 million in revenues. The ad valorem (tax related to value) stamp duty payable on loans and other securities under the Stamp Duty Act will now attract a flat fee of $5,000 per document, costing the Government $6.65 billion in revenue. The transfer tax rate on the sale of property will be cut from five per cent to two per cent, slicing $3.431 billion in tax revenue.
“As a corporate lawyer and investment banker, I can speak personally to this. These tax breaks are music to the ears of my large corporate and high net worth clients, who routinely engage in business transactions which incur these taxes,” he said.
Conversely, Golding said there is nothing in the tax giveaways for the people in his South St Andrew constituency, which includes Jones Town, Craig Town, Admiral Town, Trench Town, Rose Town, Arnett Gardens and Rema.
“They aren’t buying and selling real estate and shares. Many of them will never get a mortgage. And for those who do, it will be a once-in-a-lifetime event,” he said.
“It is true for West Kingston. It is true of the prime minister’s constituency of West Central St Andrew. It is true of Central St Catherine, Central Clarendon and East Portland,” added Golding making reference to the constituencies also represented by Local Government Minister Desmond McKenzie, Culture, Gender, Entertainment and Sport Minister Olivia ‘Babsy’ Grange and Minister without Portfolio Mike Henry, respectively.
A by-election is to be held in Portland East on April 4.
There was an outburst of laughter from some lawmakers after Golding started singing a ‘song’ he said he heard from a group of children in Trench Town last Friday.
“Santa Clarke, will you ever come to the ghetto. Santa Clarke, do you ever wonder why we suffer so?” he sang, substituting the name of the popular Christmas character with that of the finance minister and referencing last Thursday’s front-page Gleaner headline.
Golding made it clear that the parliamentary Opposition will not support this “model of development. We do not believe in trickle-down economics,” he insisted.
He suggested that the Government could have given an additional $16 billion in tax breaks that would benefit “ordinary consumers” without reducing revenues in real terms.
Golding said this could have been done by reducing the rate of GCT from 16.5 per cent “to return $16 billion to ordinary Jamaican consumers” and still see revenues keep pace with inflation.
Additionally, he suggested that the Government reduce the $14 billion projected earnings from the special consumption tax (SCT) that was imposed on fuel to help finance the Government’s election promise of moving the income tax threshold to $1.5 million.
“Give the travelling public an ease-up from high fuel prices… the taxi man and his passengers, the bike man doing deliveries, the truck man bringing food from the country, the pensioners who have to buy gas out of their fixed income,” said Golding.
“Let us not forget that part of the tax on gas was to finance a hedging insurance arrangement to protect Jamaicans from increases in the world market price of oil. That hedging insurance arrangement was abandoned by this Government, but you have kept the tax in place that was put there to pay for it,” he continued.
Golding added:”That nuh fair to the people.”