Some people just do not know when they have it good. Take Mr Lincoln Lewis who says that the Government should use money from the Treasury to create productive endeavours. The 16 per cent VAT and 33.33 per cent Personal Income Tax should be reduced (Kaieteur News “Eroding the dignity of the young by denying them what’s rightly theirs”, 08/09/2011).
Firstly, the money in the Treasury should be used to reduce the Foreign Debt from US$1080m to US$800m and to safeguard imports so that there is continuity in goods available locally and not be used to create white elephants to bankrupt the Treasury. It is about having enough money in your bank account to pay your bills Mr Lewis.
Secondly, creating endeavours does not in any way ensure that they will be productive. In the UK over 98 per cent of new businesses fail in their first year. It would be the same in Guyana. So Mr Lewis you would end up bankrupting the Treasury creating “productive endeavours”.
Thirdly, it is best to leave job creation in the hands of the private sector as they are driven by market forces, unless of course Mr Lewis wants the State to play a greater role in people’s lives.
Fourthly, the 16 per cent VAT should not be reduced as this would lead to a huge shortfall in Revenues. It is very convenient for Mr Lewis to say 16 per cent VAT should be reduce without saying where the shortfall in Revenue would be made up.
I agree that the 33.33 per cent Personal Income Tax should be reduced to 25 per cent (my figure as Mr Lewis did not provide any figure) with the shortfall in Revenue being made up from more efficient tax collection from the self-employed and from Government Borrowing (increasing the Domestic Debt).
However, doing so could fuel price inflation as people would have more disposable income to purchase goods and services at higher prices. So a reduction in Personal Income Tax could lead to higher prices thereby eroding away the benefit of that reduction. This means that there would be skyrocketing food prices, mortgages, rent, transportation, healthcare, school supplies, electricity and water rates.
Mr Lewis says, “According to the National Development Strategy, between 1992-1997, the employment decline was 46 percent in the public service; Linmine 43 percent; Bermine 30 percent; and in GuySuCo, 31 percent” without pointing out that the previous PNC Government had employed too many people in these industries without raising productivity leading to a bankrupt Treasury.
Mr Lewis, the National Development Strategy could be useful only IF it had costings in it. As an example, everyone knows that bridging the mouth of the Essequibo River would benefit Guyanese but the COST, Mr Lewis, makes it prohibitive.
There is no need for a State Planning Secretariat as it would just create another layer of bureaucracy and slow down development, Mr Lewis.
We have, in Guyana, political stability, reduced crime waves and a growing economy. These things augur well for a small country like Guyana.
Hopefully there will be political stability following the next General Election in 2011.
Aug 07, 2020Excited to chart new and successful era Just one day after being sworn in as the new Minister of Culture Youth and Sport, Hon. Charles Ramson Jr. met with the staff at the Ministry during a guided...
By Sir Ronald Sanders Amid the feverish work to cope with both the public health and economic effects of COVID-19 on their... more
Freedom of speech is our core value at Kaieteur News. If the letter/e-mail you sent was not published, and you believe that its contents were not libellous, let us know, please contact us by phone or email.
Feel free to send us your comments and/or criticisms.
Contact: 624-6456; 225-8452; 225-8458; 225-8463; 225-8465; 225-8473 or 225-8491.
Or by Email: [email protected] / [email protected]