'Regressivity in taxation'
published: Saturday | February 21, 2004

THE EDITOR, Sir:

I JUST want to comment on the letter written by John Williams titled "Jamaica's unfair tax system". I must say that Williams is completely correct in his assessment of the tax system. What exists in the Jamaican system is what we, in Public Budgeting and Finance, refer to as regressivity in taxation. It is common in, though not limited to, capitalist democracies in developed, developing, and underdeveloped countries. The same argument is made about the system in countries like the United States. The poorer class workers have to pay a greater proportion of their income in taxes than do the rich (inequity).

This kind of unfair system is not prevalent in socialist democracies. However, the 'progressivity' of the tax systems in socialist economies are seen as liberal, inefficient, and ineffective systems by financial regimes like IMF, the World Bank, and similar institutions. Manley was criticised for his efforts to keep the Jamaican tax system progressive, meaning that those who are able to pay more, proportionally, should pay more (vertical equity). In a capitalist society, the working class is an easier target for revenue generation than the affluent, who are better situated to mount their resistance.

I am, etc.,

LEROY HARVEY

lharvey9@bellsouth.net

Sunrise, Florida

Via Go-Jamaica