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LETTER OF THE DAY - Gov't should target tax evaders

Published:Saturday | May 17, 2014 | 12:00 AM

THE EDITOR, Sir:Successive governments always seem to seek the easy way out to burden those taxpayers who are compliant with more taxes, rather than to go after tax dodgers.

The lack of compliance on the part of the majority of our citizens and the lack of effective enforcement on the part of the tax authorities are directly responsible for the appalling low tax-compliance rate.

Non-compliance comes in many forms, of which the tax authorities are aware. Below are some of the methods used by taxpayers to deprive the State of much-needed revenue.

1. Non-filing of all sources of income by taxpayers.

2. Non-remittance of tax deducted at source.

3. The proliferation of contract workers used by many large companies.

4. Serial tax evaders: These are persons who form several companies, which are opened and closed when they come under scrutiny from the tax authorities (TAJ and Customs). Some of these companies are formed by well-educated individuals, including lawmakers, using gardeners, mechanics, labourers, etc., as directors.

I am proposing that the Government not seek the easy way out by taxing the compliant into oblivion. Instead, go after tax dodgers by doing some of the following:

(a) Establishment of dedicated tax courts in each parish as is necessary by using current court buildings that are used once or twice per week.

(b) Mandatory declaration of all contractors by companies that employ these workers, with compulsory withholding of a percentage of the contracted sum, thus forcing contractors to file tax returns.

(c) Mandatory income tax (advance) payment by self-employed individuals, done on a graduating scale according to type of profession.

(d) Establish a policy that no transaction regarding the purchasing of real estate through any financial institution be done without evidence of payment of income tax, not mere evidence of a TRN.

(e) Naming and shaming of delinquent taxpayers annually, as was done some time ago.

(f) Tax cheats should be sent to prison and be made examples of, as is done in other countries.

Most recently, as reported in The Gleaner of March 18, 2014, the president of Germany's top football club, Bayern Munich, Uli Hoeness, was given a three-and-a-half-year prison sentence for tax evasion.

Will I be able to see tax cheats being sent to prison in Jamaica? I will not hold my breath because of the political interference tax personnel face in doing their duties.

NORMAN MUñOZ

nwmunoz@hotmail.com