Fitz Jackson not against withdrawal tax
Published:Tuesday | April 29, 2014 | 12:00 AM
Daraine Luton, Senior Staff Reporter
FORMER State Finance Minister Fitz Jackson has indicated he is not against the withdrawal tax proposed by Finance Minister Dr Peter Phillips, but objects to account holders paying it.
"What I object to is the structure of the tax as proposed, since it opens the door for the cost to be passed on to the depositors," Jackson said.
Jackson, a government backbencher and member of parliament for South St Catherine, said the headline of an article published by The Gleaner on Saturday incorrectly reflected his position.
The headline of the article read: 'Fitz Jackson wants withdrawal tax rollback'
Finance Minister Dr Peter Phillips has signalled that he is currently reviewing the $6.7-billion tax package, which involves a move to raise $2.25 billion through a withdrawal levy.
The new tax, which will be a levy on withdrawals from deposit-taking institutions and securities dealers, will be calculated on a graduated rate system, with withdrawals less than $1 million being subjected to a 0.1 per cent tax.
The island's financial institutions have indicated they will be passing the cost of the levy on bank withdrawals on to customers.
UNCOMFORTABLE
But Jackson said he was uncomfortable with the possibility of the tax being passed on to customers. He said the tax must be structured in such a way that this does not happen.
"If you say it is on each withdrawal that each person makes, it opens the window for that pass-through. If it is a tax to be borne by the institution, then it negates that," he argued.
Jackson said the Government should resist any move by the banks to place an additional burden on financial institutions' customers' shoulders.
He said Phillips should amend the ministry paper on tax measures to make it clear that the levy cannot be debited to the account holders.