… will continue downward spiral
The 2017 Budget as presented by Finance Minister Winston Jordan, is not only convoluted, complicated and downright dangerous, but it will fail to realise its objectives with regards the projected economic growth and inflation rates.
These were among the blunt sentiments expressed by the executives of the local Private Sector Commission (PSC) when they met with members of the media corps to give their take on the National Estimates for 2016.
Chairperson of the PSCs Economic and Financial Committee, Ramesh Persaud, in railing against the 2017 Budget, said such a document is supposed to engender confidence in the business community but what instead has happened is that the Budget has confirmed a sluggish economy that will in fact enter into a downward spiral as a result of the measures proposed for implementation.
Complicated budget
Persaud told media operatives the modest inflation rate set at just above one per cent is unattainable.
He suggested that the Minister could in fact get lucky if gold prices were to trend higher in 2017 but based on available information, the real growth rate for the economy as projected by the Minster at 3.8 per cent cannot be realised.
Chairman of the PSC, Eddie Boyer, in giving his take on the Minster’s budget said it is the small man that will bear the brunt of the measures that have been sent out in the 2017 document.
According to Boyer, budgets are designed to illustrate Government’s anticipated revenues and its intention of spending that revenue but a perusal of the 2017 Budget reveals that it is in fact complicated and difficult to analyse.
It is not a simple budget, Boyer said, who revealed that taken in its entirety the budget is in no way clear and precise.
“We wanted a simplified budget, instead of something so complicated that the ordinary man at the end of the day will carry the major brunt of the Budget.”
Bitter taste
He used the occasion to lament too that the institution of a range of taxes and penalties has left a bitter taste in the Private Sector.
Boyer also used the opportunity to lament the move by Government to access the private accounts of taxpayers in order to garnish monies it believes it is owed, saying citizens are now at the mercy of the Guyana Revenue Authority.
According to Boyer, when circumstances exist where a country is going through an economic slump, high unemployment and crime rates in addition to sectors returning low outputs, such as in the rice and sugar industries, then the Government is expected to intervene in a positive manner.
This, Boyer said, is absent from the 2017 Budget.
Environmental tax
Ramesh Dookhoo, Executive member of the PSC, questioned whether the budget would have been prepared with such haste that many items would have been excluded.
It was pointed out that while there are some positives in the budget for the Private Sector, “it actually takes a lot from the business community. In summary, it gives and take away a lot… It took away more than it actually gives,” according to the PSC Executive.
Another of the measures that the PSC would have objected to, is the re-imposition of an Environmental Tax, this time not just on imports but also on locally produced items.
Dookhoo told media operatives that the Finance Minister in his presentation of the budget sought to give the impression was as a result of Guyana’s commitment to the Treaty of Chaguaramas.
He was adamant however this is not the case since without the tax, Guyana was already compliant.
With regards the effects of the proposal, Dookhoo reminded that manufacturers such as Banks DIH already are required to meet onerous obligations such as the $10 million payment to secure and Environmental Permit.
He said too that the acquisition and maintenance of equipment in keeping with the standards and requirement of the substantive legislation incurs another $600 million in expense.
According to Dookhoo, it is unfair to force local manufacturers to pay a $10 tax on each bottle of product it manufacturers in addition to its other financial commitments. l
