Mon | Aug 21, 2017

Costly inconsistency at the NHT

Published:Saturday | June 11, 2016 | 6:00 AM

THE EDITOR, Sir:

What is the rationale, if any, to explain the fact that businesses and self-employed persons can pay all of their National Housing Trust (NHT) contributions on time and can still be charged penalty and interests for late payments?

It sounds unbelievable, but this was my experience a few months ago and quite recently that of a small business operator who wanted to obtain a tax compliance certificate and was perplexed when she was informed that she was owing interests to the NHT, based on penalties applied for late payments, even though she had made ALL her payments on time.

A few months ago, when I requested an explanation for this anomaly, I was informed by a representative of the NHT that I should not try to understand why as I would be annoyed or confused. Upon insistence, I was informed that NHT contributions should be made monthly, at the end of each month, and that there is an extension of 14 days grace period into the next month by which payments should be made to avoid any late payment penalties and interests.

This was the rule by which many businesses and self-employed persons previously operated and paid their contributions and that of their employees. But, worthy of note, is that since 2014 there were new guideline and a revision announced and implemented by the Government which amalgamated the NHT, NIS, education and personal income taxes which could be paid quarterly.

And therein lies the problem. I was informed that while the Government had announced amendments which allowed for quarterly payments of NHT contributions, there have been no new directives to the NHT to effect quarterly collections, hence the NHT is still following the previous guidelines and expects monthly payments. And in this regard, (by some strange calculation), paying quarterly on time will still result in a few late monthly payments.

Whatever may be the real reasons, it is an unfortunate situation that has caused unnecessary irritation and frustration to many and needs to be corrected with urgency. If the foreign investors we hope to attract will be subjected to the same tax regulations as local entrepreneurs, then this lack of clear, consistent policy guidelines will add to the list of disincentives to doing business in Jamaica.

Daive R. Facey.

dr.facey@gmail.com