AUDLEY SHAW, the Jamaica Labour Party (JLP) spokesman on Finance, said yesterday that the Government's massive tax package will lead to businesses closing their doors, workers being thrown out of their jobs and the breakout of social unrest in the country.
Making his opening comments at the first meeting of the House Committee on Taxation Measures, Mr. Shaw said that Jamaicans will be paying even more taxes than the $14.5 billion announced by the Finance Minister in the House recently.
With recent increases in property taxes, the imposition of a $1 billion cess on tobacco products and the hiking of various user fees, Mr. Shaw said the tax package runs into about $20 billion.
"On a per capita basis, what this means is that Government intends to tax each person $7,692.31 more than last year," the Opposition spokesman on Finance claimed.
He said the JLP asked a "reputable economist" to do an economic impact study of the taxes which showed manufacturing declining by 4.0 per cent; agriculture, 3.0 per cent; distribution 3.0 per cent; transport and storage, 4.0 per cent; and construction and installation 2.0 per cent.
INFLATION IN DOUBLE DIGITS
He added that inflation will shoot up into double digits and the economy will decline by 2.0 per cent this financial year. Mr. Shaw said the extension of the 15 per cent General Consumption Tax (GCT) on several other goods and services and the imposition of a four per cent cess on imports will push up prices 10 per cent to 52 per cent, depending on the product.
SOCIAL DISTURBANCE
According to him, the study also predicted closures of businesses, lay-off of workers and social disturbance.
"Had there been prudent handling of the financial affairs of the country, instead of pursuing expenditure with a fourth term as a primary objective, we would not have to be examining ways and means of reducing these taxes...," Mr. Shaw said.
The $14.5 billion tax package is designed to chop the deficit and restore confidence in overseas creditors. Most of the revenues will come from a widening of the GCT net, to include a range of goods and services and the imposition of a four per cent cess on imports.
Members of the business community have harshly criticised the proposed tax measures.
