Time to go further,Dr Clarke
Published:Thursday | August 1, 2024 | 12:07 AM
THE EDITOR, Madam:
There have not been many occasions that I have had reason to disagree with a policy proposal by Finance Minister Dr Nigel Clarke. The recent reintroduction of an income tax credit of up to 30 per cent of the cost of the installation of residential solar photovoltaic (PV) systems is one policy I disagree with for several reasons.
This policy was first introduced during the 2023-24 Budget cycle for a period of one year but was not renewed in the 2024-25 Budget; with the passage of Hurricane Beryl it has been reintroduced.
I have not seen where the scheme was reviewed for its effectiveness, so presumably it was not very successful. Apart from being cumbersome in its design, the majority of Jamaicans do not qualify for this tax credit because they fall below the income tax threshold and as a result, do not pay income tax.
POSITIVELY IMPACT
With the recent disruption in electrical power supply due to Hurricane Beryl, there is heightened public interest in PV technology. This presents an opportunity for the Government to promote this technology through tax policy, but it needs to be in a way that is attractive to the majority of Jamaicans and not just high-income earners.
I can see a scenario where taxi men, market vendors, truck drivers, farmers, among others, would start partner plans as a mean of acquiring a small PV system that can be expanded over time, provided it is affordable. As it is, this policy does not benefit the majority of these persons, nor is it an incentive for them to acquire a PV system. Why not remove import duties on PV systems? That way, all Jamaican may benefit from this tax policy, should they choose to, and not just a small percentage of the population.
If widely implemented, PV systems could reduce the country’s fuel import bill and positively impact the country’s balance of payment accounts in short order. When he introduced this measure in the 2023-24 Budget Dr. Clarke is quoted by the Jamaica Information Service as saying, “We must reduce our dependence on energy commodities. We can go further, and we must go further.” It is time to go much further, Dr Clarke.
ALWYN GREGORY
Manchester