You can't tax your way to growth, Dr Phillips
THE EDITOR, Sir:
The Jamaica Exporters' Association (JEA) is concerned that the Budget presented by the minister of finance and planning has no clear and definitive initiatives to support the growth of Jamaica's export sector. Mindful of the often-stated need for the country to earn its way out of its problems, the JEA expected the Government to demonstrate its commitment to this objective during the finance minister's presentation. The JEA believes that consultation with the sector prior to Dr Peter Phillips' presentation would have resulted in a Budget, which is more focused on export-led growth, which is the only sustainable course for the Jamaican economy.
The Jamaica Exporters' Association believes that it is impossible for the country to tax its way out of our problems, as sustained economic growth in the Jamaican context must be export driven.
The exporters are of the view that the tax measures put forward by the minister are regressive, moves the country further away from its own stated objective for tax reform and will negatively impact the productive sector and the poor, who will continue to bear a disproportionate burden of taxation without the means to mitigate it.
The JEA calls on the Government for:
1. Specific budgetary support for the implementation of key aspects of the National Export Strategy, to which the Government has indicated its commitment, but which, to date, has got no substantial budgetary allocation to support its implementation.
2. The maintenance of specific incentives to the productive sector, including either the Modernisation of Industry Programme or a similar programme, to mitigate the extremely hostile environment that exists in Jamaica for production for exports.
3. A refocusing of critical public-sector institutions to support the productive sector in the manner that we require, such that public-private sector linkages lead to greater production and exports, including a reduction in the disincentives for export now inherent in Jamaica's regulatory culture.
The JEA board notes that had the budget targeted even 0.5% more growth, the Government would earn substantially more revenue than is currently expected from the new taxes imposed by the minister.
Exporters would have liked the Government to have taken very specific actions to reverse the continuing decline in our exports and facilitate sustained export growth. This would have sent a signal that the Government is serious about Jamaica earning its way in the world and making Vision 2030 a reality.
Immediate Past President, JEA