How far will Peter go?
When Omar Davies was running the show as finance minister, each year in his Budget presentations, the issue of widening the tax net was de rigueur. Dr Davies would lament how the same small army of Jamaicans, unlucky enough to be trapped by the Pay As You Earn Scheme, would year after year foot the burden of ensuring that Her Majesty's Revenue (the Kingston location) had enough pennies to pay government wages and salaries, finance the activities of government ministries and departments, undertake infrastructural works, and pay our myriad creditors. The lamentations about the many deep-pocketed Jamaicans who did not pay their fair share to the revenue were enough to make the jawbones of Jeremiah ache.
Yet, during the time of Dr Davies, nothing radical was done to make the tax evaders pack extra pairs of briefs and knickers in their attaché cases and handbags out of fear the revenue men may one day swoop and apply a carnivorous law. Under Dr Davies' watch and engineering, a World Bank-funded project was implemented between August 1997 and March 2001 to deal with issues of tax administration. This project was intended to broaden the tax base and impose a requirement that all Jamaicans possess a Taxpayer Registration Number. It intended to do major institutional strengthening, improve tax collection, encourage voluntary compliance, and reduce tax-compliance costs. The project reportedly achieved success through a growth in tax revenue and an increase in the number of registered taxpayers.
But with that project and others, doing nothing to deter the mass evasion and avoidance of taxes which has denied the revenue of vital contributions, Dr Peter Phillips and his team at the finance ministry decided to take radical to a higher level. Through the Tax Collections (Miscellaneous Provisions) Act and the Tax Penalties (Harmonisation) Act, the Government has finally shown its teeth, setting down rules that will, maybe, for the first time in the country's history, discourage the cheats and ginnals from attempting to bypass the revenue.
The conceptualisers of the legislation were going as far as to give the commissioner general of taxes powers that would have made him into a mini-Lord Jesus, able to require persons to pay over sums owed to a tax debtor in lieu of outstanding taxes. As Lord Jesus, the commissioner general would have also been empowered to place a lien on the property of tax debtors without a specific court order, through the issue of a certificate showing the amount owed. But, for the vigilance of the Institute of Chartered Accountants and other private-sector groups, along with the Opposition, which lobbied for and forced crucial amendments to the tax bills, the commissioner general would have achieved certified messiah status given the awesome powers at his disposal.
The move to over-radicalise legislation to address a long-standing failing in the country's tax laws bears strong similarity to what's happening in Britain. A mighty roar of criticism has met plans by the British Treasury to give itself powers to raid the bank accounts of those with outstanding tax bills. British Prime Minister David Cameron has hailed the move as being vital to the tax-collection efforts, noting, rather cryptically, that without the measure, taxes for all may have to rise.
oppose the granting of powers
But, many in the House of Commons have already signalled their intent to oppose the granting of powers to the Revenue to gain access to millions of bank accounts for the withdrawal of what the taxman claims is owed to him by the account holders. Some of the critics have cited the unconstitutionality of the move, while others suggest it's a breach of that historic document, the Magna Carta.
But, what if Dr Phillips were to again attempt to radicalise by giving the State the power to raid the bank accounts of those Jamaicans who it says owes money to the Revenue? Will Jamaicans accept it? How will we be sure that the taxman's information as to who owes what is accurate, given the fiasco of the electronic traffic ticket amnesty system abandoned by the national security ministry after days of chaos?
How far will Peter go to collect for the Revenue? And how much rope will we allow him?