PSC makes proposals to stimulate growth across all sectors

Nov 25, 2016 News

Though it has acknowledged that the slowdown in the economy started two years ago, the Private Sector Commission (PSC) firmly believes that the challenge for Government in the near future would be to stimulate economic activity across all sectors.
The Commission emphasized that while GDP growth is expected to reach 4% in 2016, this growth can be primarily attributed to increased production of gold, especially by large-scale production of two gold mining operations.
The PSC maintained that this has masked the decline in performance of other economic sectors. It said, too, that this decline is having far-reaching implications for the business sector.
The Commission said, “One manifestation of this is the significant growth of non-performing loans in the commercial banking sector. The International Monetary Fund (IMF) has reported that non-performing loans increased to 11.5% at the end of December 2015 as compared to 6% at the end of 2013.”
In a statement to the media yesterday, the Commission presented a number of measures which it believes would stimulate the economy and would lead to balanced growth while having a positive impact on Government revenue in the medium and long term.
With regard to fiscal measures, the Commission suggests that there be a permanent reduction of the Corporate Income Tax rate, over 10 years to 20%, a reduce in Personal Income Tax over 10 years to 20%, concessions on income taxation for the creation of new employment in all value added sectors, tax breaks for new tourism assets, tax breaks for companies which set up operations in depressed communities, and concessions on export tax for businesses which export and relief on outstanding loans for the rice industry.
The Private Sector also recommends that security equipment be free of all taxes and the Income Tax threshold be increased to $100,000 per month.
The Private Sector Commission believes that in the area of tax laws, Government should pursue compulsory VAT registration along with the enforcement of VAT collection on all businesses which currently do not collect this tax.
Among its other 47 recommendations, the Commission said that the Government should outline plans for diversification of the economy away from the traditional pillars of rice, sugar and gold.

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