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Shaw: Byles’ call to rethink $1.5m tax plan based on wrong assumption

Published:Thursday | April 14, 2016 | 1:27 PM
Finance Minister Audley Shaw (right) speaks with Horace Chang, Minister Without Portfolio in the Office of the Prime Minister with responsibility for Housing during the ceremonial opening of Parliament.

Damion Mitchell, Editor - Radio & Online

Finance Minister Audley Shaw has dismissed a suggestion by the co-chairman of the Economic Programme Oversight Committee (EPOC) to rethink the implementation of the $1.5 million income tax plan to reduce the risk of derailing Jamaica’s deal with the International Monetary Fund.

Richard Byles made the suggestion this week.

READ: Tax plan doubles pressure on fiscal targets

But Shaw, speaking on Television Jamaica after the Ceremonial Opening of Parliament today, said Byles’ comment might have been based on a wrong assumption.

"We have a plan," said Shaw, explaining that Byles might have been of the view that the Jamaica Labour Party Administration does not have a clear strategy to fund the initiative which would see the elimination of income tax for people earning up to $1.5 million a year.

He conceded that the original plan to use funds from the special gas tax had to be shelved after learning that the money was otherwise used up through the Consolidated Fund.

However, Shaw sought to assure that an alternative has been found which he will detail when he speaks in the Budget Debate on May 12.

Shaw also rejected suggestions that he knew from very early that the gas money was not available to fund the Government’s income tax plan.

"Despite all the newspaper stories and flashing headlines, I did not know," Shaw said.

The Finance Minister said he only became aware after assuming office and reviewing the fiscal projections with his technocrats.

A Sunday Gleaner article published last month indicated that Shaw was informed about the use of the gas tax from last year.

READ: SHAW KNEW! - Parliament records show Finance Minister was told about use of oil money

Hansard, the official verbatim records of Parliament, shows that during a sitting of the Lower House last September, Shaw, the then opposition spokesman on finance, was given a full account of what was being done with the money by then Finance Minister Dr Peter Phillips.