Government clueless about size of informal sector
ANTHONY HYLTON, the minister of investment, industry and commerce, has said despite ongoing efforts to get a fix on the value and volume of goods and services traded via the underground economy, the Government is still clueless on the matter.
The underground economy or informal sector usually refers to unregistered business activity that is unreported or under-reported, for tax purposes. It can be particularly widespread in industry sectors where cash transactions are common, such as retail, hospitality, and construction, among others, but the Government has no idea how much in tax payments it might be missing.
"That's true. We still don't have a proper sense of the underground economy, precisely because it's underground. We just know it exists, it manifests itself in many different ways. I don't know what research they've done in recent times to give some kind of notion to what it is, but I don't know that we have a grasp of what that is ...," Hylton told a Gleaner Editor's Forum last week.
However, the Government is committed to getting these business operators to formalise their operations in order to improve their competitiveness, but the minister admits it's a hard sell.
"We have to incentivise them because they are not coming out just so because a number of them are concerned about taxation. So we have to make sure that we create the environment for them to see the benefits for them to be formalised ...," he declared.
Helping these hustlers to make the transition by building capacity for them to add value to what they do is in keeping with Government's long-term growth strategy for small and medium-sized enterprises to participate fully in the business environment.
"We were able to pull together an integrated policy document with an action plan that we are moving to implement. The key to that is to ensure they have to be competitive, otherwise it's a hustle and not an enterprise," Minister Hylton disclosed. "We love talk about competitiveness of the enterprise in which they are engaged and that has to again focus the strategy to support the private sector to unlock a lot of those possibilities."