APNU promises taxes, incentives reform for social equity … to raise tax threshold $100,000, reduce VAT
October 4, 2011 | By KNews | Filed Under News
Source - Kaieteur News
A Partnership for National Unity Executive, Lance Carberry says that an A.P.N.U-led Government will immediately stop the practice by the PPP/C Administration of using hard-earned Guyanese taxpayers’ monies to reward its corrupt class of parasitic political cronies, through the arbitrary and discriminatory use of Ministerial discretion.
Carberry made that statement yesterday at one of the party’s weekly press briefing.
He explained that within the CARICOM states Guyana has the highest ratio of Central Government revenue to GDP, approaching 40 per cent.
That ratio, he explained, is likely to be greater since the “Lotto funds”, which the government refuses to pay into the Consolidated Fund, is probably not included, along with dividends and other income from NICIL, from the sale of state lands and other properties.
Given the increasing tax burden which is too heavy to bear, APNU would control this escalating situation without at the same time increasing the fiscal deficit, Carberry posited.
He said that it was evident that suppressed disposable incomes are having an adverse effect on the work effort, and too high taxes on business turnover is stifling re-investment and encouraging capital flight.
Carberry said that the APNU as an important element of its overall programme for turning around the Guyana economy would undertake tax reform by a strategy.
First, he says, that the party will stem the rise in the overall burden of direct taxation on fixed and non-fixed incomes, as well as of indirect taxation on goods and services.
Secondly, they would seek to lower the tax burden on the low income earners and the other disadvantaged segments of the population.
And lastly, the fiscal incentives such as tax holidays, tax free imports, accelerated depreciation allowances, fee waivers, etc will be granted on a more rational, sensitive and selective basis by carefully targeting, for encouragement, innovative and high value-added investments.
This, Carberry said, is to institute a more rational and objective basis for the award of incentives.
He said that it would make for greater tax equity, efficiency, transparency, administrative ease and the reduction of economic distortions.
He posited that the fiscal incentives have the effect of reducing government net revenue, even when they subsequently give rise to significant investment, production and tax generation.
The revenue (and socio-economic) loss is greatest when incentives are not awarded for the projects which have the capacity for increasing economic activity, through exports, sectoral linkages or other positive impacts, but because of the political connections of the would-be investors.
He said that studies have shown that many investments would have been undertaken anyway; therefore those investors are in receipt of a “rent” or unnecessary payment.
Specific interest he says would be on low and fixed income earners which need immediate and significant relief.
APNU would raise the income tax threshold to $100,000, he said.
He said that the senior citizens (over 6o) will enjoy a reduction in the fees charged for obtaining (or renewing) passports, motor vehicle and drivers’ licenses, airport tax exits.
Moreover, the Value Added Tax (VAT) has proven to be a windfall, since the revenue collected has been much greater than expected.
Carberry said that APNU will lower the VAT from the current rate of 16 per cent to 10 per cent. This should also encourage greater compliance.
Better tax collection efforts, especially in relation to professionals and other non-fixed income members of the self-employed class will be undertaken.
Streamline the process of obtaining permits and licenses, registering property, and other requirements for “Doing Business” placed Guyana in the World Bank 2010 report as 101 out of 175 countries worldwide.
The party would also implement programmes for the strengthening and improvement of the country’s economic and social infrastructure.
October 4, 2011 | By KNews | Filed Under News
Source - Kaieteur News
A Partnership for National Unity Executive, Lance Carberry says that an A.P.N.U-led Government will immediately stop the practice by the PPP/C Administration of using hard-earned Guyanese taxpayers’ monies to reward its corrupt class of parasitic political cronies, through the arbitrary and discriminatory use of Ministerial discretion.
Carberry made that statement yesterday at one of the party’s weekly press briefing.
He explained that within the CARICOM states Guyana has the highest ratio of Central Government revenue to GDP, approaching 40 per cent.
That ratio, he explained, is likely to be greater since the “Lotto funds”, which the government refuses to pay into the Consolidated Fund, is probably not included, along with dividends and other income from NICIL, from the sale of state lands and other properties.
Given the increasing tax burden which is too heavy to bear, APNU would control this escalating situation without at the same time increasing the fiscal deficit, Carberry posited.
He said that it was evident that suppressed disposable incomes are having an adverse effect on the work effort, and too high taxes on business turnover is stifling re-investment and encouraging capital flight.
Carberry said that the APNU as an important element of its overall programme for turning around the Guyana economy would undertake tax reform by a strategy.
First, he says, that the party will stem the rise in the overall burden of direct taxation on fixed and non-fixed incomes, as well as of indirect taxation on goods and services.
Secondly, they would seek to lower the tax burden on the low income earners and the other disadvantaged segments of the population.
And lastly, the fiscal incentives such as tax holidays, tax free imports, accelerated depreciation allowances, fee waivers, etc will be granted on a more rational, sensitive and selective basis by carefully targeting, for encouragement, innovative and high value-added investments.
This, Carberry said, is to institute a more rational and objective basis for the award of incentives.
He said that it would make for greater tax equity, efficiency, transparency, administrative ease and the reduction of economic distortions.
He posited that the fiscal incentives have the effect of reducing government net revenue, even when they subsequently give rise to significant investment, production and tax generation.
The revenue (and socio-economic) loss is greatest when incentives are not awarded for the projects which have the capacity for increasing economic activity, through exports, sectoral linkages or other positive impacts, but because of the political connections of the would-be investors.
He said that studies have shown that many investments would have been undertaken anyway; therefore those investors are in receipt of a “rent” or unnecessary payment.
Specific interest he says would be on low and fixed income earners which need immediate and significant relief.
APNU would raise the income tax threshold to $100,000, he said.
He said that the senior citizens (over 6o) will enjoy a reduction in the fees charged for obtaining (or renewing) passports, motor vehicle and drivers’ licenses, airport tax exits.
Moreover, the Value Added Tax (VAT) has proven to be a windfall, since the revenue collected has been much greater than expected.
Carberry said that APNU will lower the VAT from the current rate of 16 per cent to 10 per cent. This should also encourage greater compliance.
Better tax collection efforts, especially in relation to professionals and other non-fixed income members of the self-employed class will be undertaken.
Streamline the process of obtaining permits and licenses, registering property, and other requirements for “Doing Business” placed Guyana in the World Bank 2010 report as 101 out of 175 countries worldwide.
The party would also implement programmes for the strengthening and improvement of the country’s economic and social infrastructure.