JLP would act differently, says Holness
Opposition Leader Andrew Holness yesterday claimed that a Jamaica Labour Party (JLP) government would have done things differently if he were ushering the country through the current economic storm.
"What the Government presented as tax reform is rubbish," argued Holness during a press conference at the JLP's Belmont Road, New Kingston, headquarters.
He charged that an authentic tax-reform programme should have been pursued instead of venturing on a path of austerity that threatened productivity and served to throw the lives of Jamaicans in disarray.
Holness argued that this lack of understanding on the part of the Portia Simpson Miller administration characterised the difference between the two major political parties.
"The Jamaica Labour Party can't be compared with the People's National Party, we are not the same," he declared. "We would not have come with a JDX2 (a second debt exchange after the Jamaica Debt Exchange introduced in 2010), it's not the right time," he added.
Holness asserted that the policy that should have taken precedence was fundamental tax reform.
"Fundamental tax reform is not part of the austerity package, but part of the growth-inducement package," Holness stressed.
"When we were in Government ... we divested Air Jamaica because getting rid of the loss-making enterprises was one of the low-hanging fruits, you do that first," he stressed.
Added Holness: "The time that you are at now is tax reform. And the Government simply did not understand it."
Consensus from private sector
The opposition leader suggested that tax reform was the way to go because there was major consensus from the private sector.
"They were the ones who spent quite a bit of resources, admirably so, to bring to the table a proposal," asserted Holness.
However, he lamented that the Simpson Miller administration squandered that opportunity.
"Fundamental reforms were necessary and therefore tax reforms should have been done within the first two or three months after the (December 2011 general) elections."
Said Holness: "You would have been in a better place because tax reform is not about increasing taxes, it is about simplifying your tax system and increasing your tax base."
The opposition leader said the path undertaken by the Portia Simpson Miller administration in unloading a heavy tax burden on the shoulders of Jamaicans was definitely not the course to pursue at this time.
"Our issue has always been with timing and sequencing," said Holness. "You must bear in mind that you are conducting a debt exchange in an environment of great uncertainty, declining confidence," he added.
Holness said when the Bruce Golding administration executed the first debt exchange, there was economic stability.
"The present Government is executing a debt exchange with a dollar that is sliding and reserves that are depleting rapidly ... that has an impact," he argued.
Of the new debt exchange, Holness said: "The market will receive it in a tentative way in the short term, but in the long term bond holders and investors are going to make changes to their long-term portfolio decisions ... in effect, what will happen in the long term is that people will be shying away from Jamaican dollar-denominated instruments to look for safer ground."