Jamaican Tax Review Slated For September
Monday August 15 2011 | 07:41 AM

A review of Jamaica's planned tax reforms is to get under way in September, and will scrutinize the government's proposals for creating an efficient, simple and fair tax system.

A Parliamentary Tax Committee will begin its review in September, and will be chaired by the Minister of Finance and the Public Service, Audley Shaw. The committee's creation was announced in July, when Prime Minister Bruce Golding said he would "urge the Committee to consider what is in the broad national interest, and not necessarily what may be savoured by particular interest groups, no matter how powerful they may be."

The Finance Ministry said that, delivering on a promise that the review and reform process will be all-inclusive and comprehensive, the government will call on all stakeholders, including business and professional organizations, civic bodies, trade unions, academics, workers and the general public, to submit comments and suggestions on the Tax Reform Green Paper.

In the nine-member committee, Shaw will be joined by the Minister of Agriculture and Fisheries, the Minister of Tourism, the Minister of Foreign Affairs and Foreign Trade, the Minister of Industry, Investment and Commerce, and four other members of parliament.

The government's intention in reforming the tax system is to ensure that it is simple and efficient, provides equity and fairness, stimulates economic growth and yields adequate revenue.

In May, Shaw introduced the government's Green Paper, titled "Tax Reform for Jamaica". General consumption tax will be reduced from 17.5% to 12.5% in January, 2012. Corporation tax will fall from its current rate of 33.3% to 30% in January, 2012, and drop to 25% by 2013.

Personal income tax thresholds will then rise dramatically, lifting many out of income tax altogether. The threshold will increase yearly, starting in 2012, and going from JMD441,168 (USD5,193) to JMD507,312. In 2013 it will reach JMD600,288, and settle at JMD624,000 in January, 2014. A revenue loss of JMD16bn will be incurred, and approximately 101,512 people will eventually pay no income tax at all. Changes to the property tax are also expected.

The government hopes that the feedback provided through the consultations will result in a final White Paper, to be presented in 2012.