PPP/C undercuts 2018 budget presentation

Nov 02, 2017 News

…submits motion to reduce VAT to 12% & other fiscal measures

Opposition Leader, Bharrat Jagdeo

The People’s Progressive Party Civic (PPP/C) has undercut the Government’s upcoming 2018 budget presentation by submitting its own Motion with a range of fiscal proposals, including scaling back the Value Added Tax (VAT) on some services and products.
Opposition Leader, Bharrat Jagdeo warned that the declaration by Minister of Finance, Winston Jordan, of no new taxes for 2018 may sound good, but in the wider scope of the economy, the damage financially is already done.
“When he says there are no new taxes in this year’s budget, is he saying that they are not going to introduce new taxes, but increase rates? Frankly speaking, the damage is already done to productive sectors and to welfare. They will have a hard time finding new taxes to put in place; so no new taxes don’t mean anything,” Jagdeo told reporters yesterday.
The former President and Minister of Finance said, that since the coalition Government came to power in 2015, it has progressively introduced measures that adversely affected the mining and forestry sectors.
According to the Motion submitted by the PPP/C, they are hoping to reduce VAT to 12 percent as proposed by the APNU+AFC Coalition during the 2015 electoral elections. The Motion also seeks to reverse VAT on essential food items; electricity and water; pharmaceuticals and medical supplies; and all education goods and services.
The PPP/C Motion also wants to remove ‘burdensome taxes’ on the mining sector by reducing the contributors’ tax from 20 percent to the original 10 percent and remove the two percent final tax paid by miners.
As it relates to fiscal policies, the PPP/C’s Motion seeks the reversal of the Bank of Guyana Cabinet-directed decision to licensed currency dealers, commercial banks and cambios, to limit the spread between the buying and selling rate of the US dollar to no more than $3.
While the motion calls for an increase in wages and salaries in the public service, it does not offer specifics. Additionally, the motion calls for active negotiations with the unions for increases of salaries and benefits for public servants and teachers. The PPP/C has been accused in the past of forgoing the negotiating process with unions and imposing salary increases across the board.
The PPP/C’s motion as submitted to the National Assembly, calls for the release to the public of the ExxonMobil agreement with Government. Also, some projects which the PPP/C had pursued during their years in Government are also stated in the motion to be restarted, including the Amalia Hydro Falls project.
In education, the motion calls for the restoration of the ‘cash care’ programme for each child registered from nursery through secondary and an increase to $ 20,000 per child; restore and increase the school uniform vouchers to $4000 per child across the country; and the removal of VAT on education goods and services.
The motion has not been included in today’s sitting, but if it is included in a subsequent sitting, will require support from Government MPs for passage. At his press conference, Jagdeo downplayed presenting the party’s ideas directly to the Finance Minister ahead of the budget presentation on November 24th. Instead, he sought to highlight the party’s motion as the route the party has taken.