Senator: Government to consider slashing GCT - Minimum business tax axed
Published:Saturday | November 30, 2019 | 12:00 AM
Even as the Upper House unanimously passed legislation yesterday to withdraw the $60,000 minimum business tax, a government senator has responded to the Opposition’s call to reduce the general consumption tax (GCT), saying the Holness administration will consider the proposal favourably.
Senator Charles Sinclair argued that although the decision was the finance minister’s to make, he was confident that a reduction in GCT could receive positive consideration from the administration.
Opposition Leader Dr Peter Phillips earlier this week urged the Government to reduce GCT by two percentage points. This would cut the consumption tax from 16.5 per cent to 14.5 per cent.
“This administration considers all the possibilities; this administration considers the factors that will bring relief to the Jamaican people, and I am certain that if it can be done, if it can be facilitated, history has shown the people of Jamaica that the Government will act in an appropriate way,” Sinclair said during his contribution to the debate.
Leader of Government Business Kamina Johnson Smith, who opened debate on the minimum business tax, said the measure was criticised for being inequitable after its imposition in 2014 under the previous People’s National Party administration.
She said that removal of the revenue measure would reduce the tax burden on micro and small business and allow the country to improve on its doing business world ranking.
However, for persons who had accumulated arrears, Johnson Smith said the legislation did not provide relief for them.
“We have answered the louder call to remove the minimum business tax and the hindrance it was to small business,” she added.
In his remarks, Opposition Senator Dr Andre Haughton commended the Government for scrapping the tax, noting that it was a big hindrance to small business activities.
Haughton urged the administration to make the tax relief retroactive, as it would assist businesses already overburdened by the measure.
Government Senator Don Wehby encouraged small business owners to use the savings from the tax to reinvest in their businesses. He noted that small and medium-sized enterprises will collectively retain $1 billion from the removal of the tax.