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May 19, 2022 News
…Bill only takes care of business elites ahead of poor, working class—Opposition
By Gary Eleazar
When the Private Sector in Guyana tells the current government to jump, its response is to ask how high, a sentiment expressed by Shadow Minister of Finance in the Opposition benches of the National Assembly, Juretha Fernandes.
She was at the time debating in the National Assembly the Tax Amendment Bill, which was successfully piloted by Minister within the Office of the President with Responsibility for Finance, Dr. Ashni Singh. Fernandes said the bill highlights the priorities of government namely addressing the needs of the business class ahead of addressing with a sense of urgency the plight of the poor and working class citizens. Fernandes qualified her opinion as a result of utterances made by Dr. Singh when he presented the Bill for debate during Tuesday’s sitting of the National Assembly, and said that it had been presented as a result of a demand made by the Private Sector.
LONGSTANDING IRRITANT
During his presentation of the Bill to the House, Dr. Singh noted its relative simplicity since it only abolishes the need for the use of revenue stamps by businesses in retail sale.
According to Dr. Singh, the measure had been announced since Budget 2022 and that the Bill being presented was simply bringing that commitment to a realisation. Recognising that over the years the requirement for the revenue stamp to be affixed has been observed more in the breach, Dr. Singh disclosed that the “requirement has also been a longstanding source of, perhaps I shouldn’t say irritant but it has been an issue that the Private Sector has raised from time to time and the removal of the requirement that revenue stamps be remove for retail transaction was in fact a specific representation made by the Private Sector.”
This he said was done during one of its many consultations held. According to Dr. Singh, the move simply seeks to remove the requirement in relation to revenue stamps on receipts issued for retail transactions. While supporting the Bill in principle since the quantum received on stamps by the coffers was negligible and that the Guyana economy was in a much better place than it was when such tax sources were needed, Fernandes noted too, that in many cases even established businesses are in breach of the requirement and that would cost more going after the defaulters than what would or could be recovered. As such, she said the Bill was in principle easy to support. She did use the opportunity nonetheless to highlight that the Tax Amendment Bill being passed at the request of the Private Sector illustrates in a pellucid fashion where Peoples Progressive Party Civic (PPP/C) administrations priorities are—the business class and not the working, poor and vulnerable groups. She told the House that the amendment was simply adding to the list of tax exemptions being made available for a specific group in Guyana.
Expanding on her position she observed for the House what she termed a “profound statement” made by Dr. Singh during an unusually rare, short presentation to a debate, namely that the amendment was being promulgated as a result of the demands of the Private Sector.
“A specific request was made by the private sector and the government in its optimal wisdom that it has been seeing believes that when the private sector says jump they ask how high,” she quipped. She acknowledged that adjustments and amendments to tax legislation are nothing new, and it is in fact impactful when they meet the demands of the pressures being faced by Guyanese. To this end, the Opposition Spokesperson on Finance noted that the Bill being debated in the House would have little to no impact on the ordinary Guyanese at a time when the country is simultaneously battling with inflation.
COMPREHENSIVE REFORM
She noted that while that Bill was being debated, the Income Tax Threshold is yet to have meaningful adjustment in order to give the Guyanese some reprieve in meeting the exorbitant increase in the cost of basic food items. The Bill, which proposes to remove the stamp duties on retail transactions which represented a negligible source of revenue for the coffers and as such it can be agreed with in principle but it should have been extended to all stamp duties and not just for retail transactions. According to Fernandes, “…it is only removed from the retail transactions because this is a response to a request by the private sector.”
Stamp duties were necessary when the revenue base was thin, she said, and every effort was necessary to broaden the tax base today the country is in a far better position to remove the stamp duties altogether. She was adamant however, that while supporting the move in principal, “it would have been more prudent for the government to come to this House and to present to these House amendments that are more comprehensive.”
According to Fernandes, a more comprehensive tax reform “is something we need right now.”
With this in mind, she posits, that the Bill as presented goes to show only a few businesses that are specifically bothered by that tax requirement, “when they cry out to the government for assistance their needs are met with a sense of urgency that poor and working class Guyanese are never afforded in this country and that is the fact at hand right now; we should not tolerate this, it is in your face as it can possibly be and I do not understand the pride that comes with such an announcement.”
SIMPLY UNACCEPTABLE
To this end she accused the government of approaching tax reform in an ad hoc manner instead of a comprehensive approach and that government in its approach was only looking to take care of a few. A tax cut, she said, was akin to a cash hand out and that House should be able to better determine into whose hands this money is being placed and reiterated, “…this (Bill) is geared to the private sector, this is the type of policy that the administration has employed from day one.” Guyana, she said, is a country where the majority of its citizens belong to the poor and working class and that “this is unacceptable.”
She posited that the amendment will result not in a reprieve for the poor or working class but rather would only increase the profit margin for businesses that would stand to benefit from the tax reprieve.
According to the Opposition Members of Parliament (MP) and that for the House to meet at a cost of millions to debate a Bill that benefits only a few “is simply unacceptable.”
To this end, she posited that the people of Guyana are tired of being pushed on the back burner while the most affluent in society are catered for with urgency. Other contributors to the debate included the Minister of Tourism Industry and Commerce, Oneidge Waldron, and A Partnership for National Unity’s (APNU+AFC) Volda Lawrence. Given the voting strength in the House, the Bill was successfully passed following a rebuttal by Dr. Ashni Singh.
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