4:13 – Revenue side of the Budget
Total Revenues – $407Bln
Tax – $360Bln – Exceeds out-turn of last year by 12% Will concentrate on collections. Streamlining to remove distortions. Adjustments to GCT Act to zero-rate electricity to domestic users. Adjustments to Customs Administration Fees, bias towards imported finished goods. This will be reviewed and become revenue neutral.
Non-Tax, Bauxite Levy – $36Bln
Capital Revenue & Grant Inflows – $11Bln Was withheld pending negotiations with IMF
Loans – $113Bln
FULLY FUNDED BUDGET. THERE ARE NO NEW TAXES.
4:06 – Small business provide the majority of jobs in Jamaica. Small businesses account for 88% of all businesses which file GCT, 50% of our GDP and 53% of our employment. In 2013/14 Development Bank of Jamaica plans to loan J$2Bln to micro and small business sector – an estimated 12,200 small business owners. The DBJ will reach out to current lenders and credit unions to increase capacity to lend at those institutions. Further, it will introduce innovative new products such as mobile banking in order to lower the cost of borrowing.
4:03 – New Charities Act and tax treatment of Charities by September 2013.
4:00 – Tax Reform. 1. Meet the revenue demands of the Government, 2. Equity, 3. Tax compliance. Based on policy. Widen the tax base. Over the next 4 years Jamaica will institute the largest reform of its legislative tax system in decades. It will remove most zero-rated items. This will improve standardisation and ease of auditing and transaction processing.
3:54 – Increase the number of Executive Agencies to increase autonomy and streamline efficiency: 1. Jamaica Customs Department within 6 months of 1 April, 2. The Department of Fisheries, 3. Port Management, 4. BGLC will merge with the Jamaica Racing Commission. There will also be a Human Resource Development Department that will span the entire Public Sector to make the system more efficient.
3:52 – Riu is building a new hotel at Mahoe Bay which will open in time for the next winter tourist season. The first new hotel in 5 years. There is also reinvestment and retooling in current hotels.
3:47 – As of 1 June 2013 the GoJ will be making requests for proposals (RFPs) for integrated resort developments with casino gaming and large hotels as the focal point. The integrated model follows the Singapore model which in only a few years has already surpassed Las Vegas in operating revenue. The Minister says there are already 6 interested parties.
3:28 – Strategic Direction – making Jamaica a logistic hub. 1. Privatize Kingston Container Terminal. 2. Electronic Port Community System. Will begin building this fiscal year and complete by 2015/16. Will involve close collaboration between public and private entities.
Second Node of Strategic Direction is ICT.
Another critical area is Agricultural Production. 2 of the 9 planned Agro-Parks have already been established. Funded in part by the European Union.
3:26 – Privatization of enterprises – Kingston Container Terminal, Caymanas Track Limited, Norman Manley International Airport, Wallenford Coffee Company. Sale or Lease Agreement for Clarendon Alumina Partners (CAP – 45% owners of JAMALCO).
3:10 – Major Infrastructure Development Programme – now in the Capital B budget for the first time.
3:02 – PATH beneficiaries will receive an increase of 15% in August 2013 and a further increase of 15% in August 2014. J$780Mln out of J$800Mln of Poor Relief Programme allocated to Parish Councils for the operation of infirmaries.
2:57 – Wages and salaries makes up 53% of the total non-debt Government budget. This is 10.3% of GDP. This includes back pay for education workers, reclassification of health care workers and the one-off payment as agreed with the public sector.
2:48 – Primary surplus of 5.3% was achieved. Inflation is within target. Loan rates are near all-time lows. These will improve as Jamaica continues to keep a tight fiscal policy. Alumina plant at Ewarton is returning to full capacity. Energy is critical to reopening the remaining plants. The falling NIR was due to a lack of flows. The JEEP employed 36,000 persons.
2:47 – Change the way we operate. Spend less time in Government lines.
2:42 – Lack of an IMF deal would affect the poorest among us by contracting the economy further. The goal is to decrease Debt to GDP ratio from 140% to 95%, reduce Public Wages as a % of GDP to 9%. Reverse long-term trend of low growth and declining productivity.
2:38 – IMF seal of approval gave Jamaica access to World Bank and Inter-American Development Bank funds. This seal of approval also reopens access to cheaper capital in the local and international markets.
2:35 – Primary surplus is expected to rise from 3.1% in 2012/13 to 7.5% in 2013/14. Debt Servicing is projected to fall from 54% to 43%. A consequence of high debt burdens is high borrowing rates at local and international capital markets.
2:31 – IMF programme had collapsed when the PNP took control of Government. Philip’s refers to 2013 as The Year of Decision. Pays tribute to the public sector workers of Jamaica without whom the IMF deal would not have been possible. Pays tribute to bondholders including pensioners who “stood up for their country”.
2:25 – Minister Philips thanks his entire team for the completion of the IMF deal. Thanks PM Portia Simpson-Miller for her leadership and unwavering support as leader.