While it is yet too early for full and extensive statements to be made about Budget 2017, off the bat, we know that the imposition of Value Added Tax (VAT) on basic commodities like water and electricity is of great concern.
That is the gist of the position currently taken by the Private Sector Commission and the Central Corentyne Chamber of Commerce.
Contacted yesterday, Chairman of the Private Sector Commission (PSC), Eddie Boyer told Kaieteur News that his team is still studying Budget 2017. He was skeptical about making comments at “this early stage” as he stressed, “we are still analyzing things.” Boyer said that his team is looking to see how much of what was requested by the private sector has been included in the Budget.
“We submitted a menu of request…I cannot say much of what has been included as yet, but we are happy about the increase of the free pay to 60,000. We were hoping it would have gone higher, but that will help quite a lot. I guess they (the government) are moving in the right direction.”
However, Boyer said that the introduction of VAT on water and electricity bills is a sore point.
The businessman said, “I would hate to comment on that now. It is sad. A lot of money will be taken out of the economy. Having to pay tax on water and electricity is a lot to swallow. Then there is the environmental tax, these are a little punitive in terms of when you look at how much it will cost the average man”
Boyer said that there are a number of issues in the Budget, “…but one has got to be reasonable in terms of looking at the fact that to run the country they (the government) would have to get funds. But generally the main areas… water and electricity tax and the environmental tax.”
The Central Corentyne Chamber of Commerce released a statement to the media yesterday that reflected similar concerns. The body said that it will issue a detailed release on the budget shortly, “but one general feeling is taxes and more taxes on an already burdened population. One item that has jumped out at us and one which we have found to be totally reprehensible is the imposition of vat on electricity and water”.
The Chamber said, “This is a real “sleight of the hand” operation by the Minister, reducing VAT by 2% and then coming in through the back door and poking it back at us. We are calling for this measure to be immediately withdrawn!! The majority of ordinary Guyanese pay more than 10,000 for electricity and 1,500 for water monthly, this means their bills will automatically go up by 14% which may work out more than the salary increases they will get.
Also the 2% transfer charges on selling of a vehicle are another back door tax and should also be withdrawn. The increase in threshold and with the one third measure of exempt income is welcome, as even with a higher bracket of 40%, the effective tax rate as shown in the calculations, will be lower. But why spoil this desirable measure by taking it back with the next hand. Guyanese, it seems, are destined to remain in poverty.” (Abena Rockcliffe-Campbell)
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