Dear Editor,
I am not opposed to taxation per se. It is indispensable to the proper functioning of any government. How else would a government be able to fulfil its obligations to its citizens? How else would it be able to fund such necessary initiatives as education, health care, oldage security, and all forms of basic infrastructure? What I am totally against is certain penny-pinching, punitive methods by the government in imposing taxes on its population.
The most recent ridiculous, idiotic, and punitive tax is the Jamaican Government’s imposition of a bank deposit withdrawal tax. This means that any withdrawal from a deposit account would be subject to a tax. What is the justification for this type of bizarre, unfair taxation that is estimated to yield $2.5 billion, when the Government has failed to collect over $5 billion from delinquent taxpayers?
It goes without saying that the withdrawal tax will be counterproductive in that it will definitely discourage people from saving money in the commercial banks.
There is no doubt that this type of disincentive will fuel the underground economy, whereby many business transactions will be conducted on a cash basis. Many people will probably be encouraged to save their money in the proverbial mattresses and other unsafe places. This practice will definitely produce ripple effects such as an increase in burglary.
If this idiotic withdrawal tax is ever implemented the entire banking institution may come to a grinding halt, since very few people and companies will be eager to continue conducting business transactions with financial institutions.
What is needed in Jamaica in order to generate revenue is a complete reform of the taxation system. For many years the country has relied heavily on the pay as you earn (PAYE) system. This meant that the only reliable source of revenue came from government employees.
There was and probably still is no proper accounting practices by small businesses such as shop keepers, small farmers, taxi drivers, pedlars, and trades people to name a few. In addition, big business enterprise may still be evading taxes. Perhaps the Government is negligent in its demand for good accounting practices. It, therefore, follows that the lack of proper bookkeeping practices has made it virtually impossible to monitor delinquent taxpayers.
The absence of a systemic collection of taxes has been the bane of the Jamaican governments for many years. Because of the inability of all Jamaican governments to collect taxes from all sectors of the business community, the present Government has resorted to an easy way to generate much-needed revenue. There is no doubt that the deposit withdrawal tax is regarded as an easy and sure way of raising revenue.
But this approach seems to be backfiring in that most Jamaicans are furious about this penny-pinching form of taxation. My advice to the Government is scrap this absurd and punitive tax immediately and bring about a drastic reform of the taxation system.
Rupert Johnson
Toronto, Canada
r.b.johnson@sympatico.ca
I am not opposed to taxation per se. It is indispensable to the proper functioning of any government. How else would a government be able to fulfil its obligations to its citizens? How else would it be able to fund such necessary initiatives as education, health care, oldage security, and all forms of basic infrastructure? What I am totally against is certain penny-pinching, punitive methods by the government in imposing taxes on its population.
The most recent ridiculous, idiotic, and punitive tax is the Jamaican Government’s imposition of a bank deposit withdrawal tax. This means that any withdrawal from a deposit account would be subject to a tax. What is the justification for this type of bizarre, unfair taxation that is estimated to yield $2.5 billion, when the Government has failed to collect over $5 billion from delinquent taxpayers?
It goes without saying that the withdrawal tax will be counterproductive in that it will definitely discourage people from saving money in the commercial banks.
There is no doubt that this type of disincentive will fuel the underground economy, whereby many business transactions will be conducted on a cash basis. Many people will probably be encouraged to save their money in the proverbial mattresses and other unsafe places. This practice will definitely produce ripple effects such as an increase in burglary.
If this idiotic withdrawal tax is ever implemented the entire banking institution may come to a grinding halt, since very few people and companies will be eager to continue conducting business transactions with financial institutions.
What is needed in Jamaica in order to generate revenue is a complete reform of the taxation system. For many years the country has relied heavily on the pay as you earn (PAYE) system. This meant that the only reliable source of revenue came from government employees.
There was and probably still is no proper accounting practices by small businesses such as shop keepers, small farmers, taxi drivers, pedlars, and trades people to name a few. In addition, big business enterprise may still be evading taxes. Perhaps the Government is negligent in its demand for good accounting practices. It, therefore, follows that the lack of proper bookkeeping practices has made it virtually impossible to monitor delinquent taxpayers.
The absence of a systemic collection of taxes has been the bane of the Jamaican governments for many years. Because of the inability of all Jamaican governments to collect taxes from all sectors of the business community, the present Government has resorted to an easy way to generate much-needed revenue. There is no doubt that the deposit withdrawal tax is regarded as an easy and sure way of raising revenue.
But this approach seems to be backfiring in that most Jamaicans are furious about this penny-pinching form of taxation. My advice to the Government is scrap this absurd and punitive tax immediately and bring about a drastic reform of the taxation system.
Rupert Johnson
Toronto, Canada
r.b.johnson@sympatico.ca