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Mark Wignall | Another budget, another tax package

Published:Wednesday | March 15, 2017 | 12:00 AMMark Wignall

Age has its virtues, but also its many setbacks, not the least of which is cynicism. Cracking the over-60 age barrier would mean that one has seen much, and much of that would have been the same, year after year.

At about this time each year, the party running the governmental administration gets its time to tell us how collectively deep in the hole we are and how creative it will be in digging us out of it. And key players in the opposition will utilise their time in ensuring that no common ground of agreement is struck. The Budget would be a big, loud yawn were it not for the very real consequences.

The echoes of it are still bouncing around in our memories when Andrew Holness, as opposition leader, told us before the February 2016 election how safe and secure we would be should we dare to elect his Jamaica Labour Party (JLP) and give it power. The man who sold locks and doors would go out of business because we would no longer need them. Plus, we would have no need to toss and turn while we slept in peace, afraid no longer of those who would wish to do us harm.

When he said that, it did not particularly invoke the cynic in me. I simply laughed and said to myself that he must have had a pretty gullible, party-waving crowd that day. I didn't need to be a cynic to recognise that he was tossing out red meat to his party base on that day. It was my time to yawn, shut my door, carefully lock up and try desperately for a bout of peaceful sleep.




When Holness made his election-winning pitch about raising the tax threshold and placing more spending money in the pocket of Pay As You Earn (PAYE) workers and the plan was to do so without the imposition of any new taxes, again the sensible among us knew the game, but perversely, we gave him a free pass on that.

A few weeks ago when it became clear to many of us that the JLP administration would be forced to continue the raid on the richly endowed National Housing Trust (NHT) bonanza as the previous People's National Party (PNP) government did, the word 'ethics' floated around for a while until reality struck home. Remember now, at the time in 2012-2013 when it was done, the JLP, as the opposition party, cried bloody murder.

In his budget presentation, the PNP's Peter Phillips explained it as it happened.

'Let me make it clear that in 2012 and 2013, the administration of which I was a part inherited a national economic emergency which the prime minister admitted in the run-up to the 2011 elections when he promised "bitter medicine".

- The JLP government had in reality abandoned the IMF Programme.

- Jamaica had no access to either domestic or international capital markets.

- In the absence of the IMF seal of approval, multilateral institutions such as the World Bank, the IDB and EU were not providing financing to Jamaica.

- By 2013, the country's international reserves had slipped below internationally recognised minimum levels.

- No contracts were in place for any of the public-sector workers.

- The primary surplus target which was set at five per cent was breached.

'This was the national economic emergency that we inherited. Before the IMF would consider re-establishing a programme for Jamaica, specific prior actions were required:

- A wage freeze

- A second national debt exchange; and

- Correction to the fiscal imbalance.'

The significant difference is easy to see. Under the guise of moving Jamaica away from direct taxation to one where, in some distant future, only consumption would be taxed, Andrew Holness made an election promise to free up significant numbers of our working population of their direct tax burden.

Hence the continued raid on the NHT and the increased taxes on petrol, cigarettes, alcohol, motor vehicle licence fees, health insurance premiums, etc.

The road to prosperity is fraught with many dangers, not the least of which are politicians running up their mouths on the campaign trail. For now, I have tuned out of the JLP's prosperity message because of what it was designed for - vote-catching, and the return of that old cynicism.