The 2014-2015 budget debate began last Thursday, April 17, with Finance Minister Dr Peter Phillips’ presentation. The national budget of $539.3 billion was tabled two weeks prior. You can see the budget in its entirety here.
To begin, Phillips noted that the budget debate “provides us with the opportunity to take stock of our performance over the previous fiscal year and to measure our progress in relation to the targets previously set and to assess the effectiveness of our management of the country’s finances.” He later highlighted some changes that have taken place in the economy since last year’s budget debate, including the fact that while the economic reform programme was in place, Jamaica’s negotiations with the International Monetary Fund (IMF) had not been concluded, and that “the established pattern of weak or negative growth persisted.”
In contrast, this year finds the country’s economic reform programme is “on track and the IMF Agreement is in place and we have concluded and have passed all our tests and met our benchmarks” and “growth has returned. We have had three consecutive quarters of increasing growth – each level higher than the one before.” Read the rest of the finance minister’s opening statement here.
Phillips also announced that the government will be seeking to raise $6.7 billion in additional taxes this fiscal year, contradicting his statement in January that there would have been no new taxes announced this year.
Among the new measures are:
- The unification of the tax on alcoholic beverages – $844 million
- Increase in the age limit in the sale of second hand vehicles – $26 million
- Asset tax increase – $1.78 billion
- Change in the tax regime for insurance companies – $1 billion
- Modification of the duty regime for specified vehicles $1.2 billion
- Levy on withdrawal from deposit-taking institution and encashment from securities dealers – $2.3 billion
This last measure has angered a large portion of the population, with many commenting that it is ‘draconian,’ although it does have a few supporters. We’re tracking the issues surrounding this story as it unfold here on the diGBlog.
You can read the rest of the 2014-2015 revenue measures here.