JMMB head calls for Gov't to fulfil commitment to phase out asset tax
Published:Monday | September 23, 2024 | 12:35 PM
Chief Executive Officer of JMMB Group Limited, Keith Duncan, on Monday urged the Government to phase out the asset tax, citing the financial sector's support during the COVID-19 pandemic.
Duncan said that the sector backed the Government during the pandemic, and now it's time for the Government to return the favour.
In 2020, as the pandemic struck, JMMB and other financial institutions, negotiated with the Government to delay a planned reduction in the asset tax, which was originally proposed to be halved in 2020.
“It was in the budget to halve the asset tax and then phase it out,” Duncan explained.
“We, in our wisdom, went to [Dr Nigel] Clarke in March of that year,” Duncan said at the JMMB Group's annual general meeting (AGM) in Kingston. “We said, 'Keep the asset tax; there is too much uncertainty, and we need to give you the fiscal room to manage through COVID.'”
But the financial sector, didn't put it in writing, said Duncan at the AGM being held at The Pegasus hotel in Kingston,“because we were also dealing with COVID.”
The participants involved in the deal were the Insurance association of Jamaica, Jamaica Bankers Association, and Jamaica Securities Dealers Association, said Duncan.
“It's a distortionary tax,” he said. “We believe enough fiscal room has been made and now it is time.”
Duncan highlighted JMMB's contribution, noting that the company paid $1.4 billion in asset tax for the current fiscal year, more than twice the dividends paid out.
He emphasised that since the tax's introduction in 2013, JMMB alone contributed over $6 billion in asset taxes—a burden separate from income tax, leading financial institutions to operate at higher tax rates.
During the AGM, Duncan pointed out the broader struggles of the financial sector, particularly the losses some institutions faced due to volatile capital markets and high-interest rates aimed at curbing inflation.
Duncan called on the Government to fulfil its original commitment to phase out the tax.
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