(www.kaieteurnewsonline.com) While President of the Georgetown Chamber of Commerce and Industry (GCCI), Clinton Urling has described the 2014 Budget as “people friendly”, he said the private sector would have preferred to see more initiatives aimed at increasing and improving consumer spending.
Urling said that he would have wanted to see a drop in corporate taxes to around 5 percent as was done just about two years ago. He said that at that time there was skepticism among many that revenues would have reduced as a result of the tax cut. Corporate taxes increased by 16 percent last year.
Urling told media operatives during a press conference yesterday at GCCI’s boardroom that as it relates to the Pay As You Earn (P.A.Y.E) tax, it should have been reduced by another 3 1/3percent.
“That is another one that should have been reduced. Last year it was reduced by 3 1/3 percent and the economy lost around one billion in revenue. The Government could have further reduced that rate to another 3 1/3 percent and look at other ways of offsetting the revenue lost.”
Another initiative Urling said that the Government could have considered is reducing the high tariffs on imported meats. These include chicken, beef and pork. This would reduce the prices for those commodities on the domestic market, thereby saving consumers billions in disposable income annually.
“If those rates are reduced, we could see maybe a $100 saving on just chicken alone and it is estimated that Guyana has over 188,000 households and we are talking about billions in savings annually by simply adjusting that tax.”
He added, “Last year we saw Government revenues going up by 4.8 percent. Specifically, we saw tax revenues increase by 7 percent to $126B. So, despite the reduction in P.A.Y.E and in corporation tax we are still seeing an upward trajectory in terms of Government’s revenue collection and in specific, its tax revenue increases.”
The GCCI President noted too that it is also important to underscore that as annual tax adjustments are made, it brings one back to the conversation of ensuring that there is a comprehensive tax reform process. The GCCI has been advocating for this for some time.
He reminded that President Donald Ramotar had indicated that he wanted to see the work of a tripartite committee established to examine tax structure and make recommendations. “We think the process is important. And at the end of it, they would share the proposals with the population so everyone has an understanding of where Government is going and what are its tax positions when it announces budgetary allocations, so tax reform wouldn’t come as a surprise to anyone. It should be a comprehensive process which should be made public by Government. We look forward to the tripartite process being completed or the establishing of a committee to pronounce on tax reform.”