Coalition minority calls for review of VAT on education

– wants committee set up to review private schools

In what it calls the “Linden declaration”, the Alliance For Change (AFC) has decided to lobby its coalition partner in central government for the removal of the Value Added Tax (VAT) on private education in 2018.

The party also wants a committee to be set up to review private schools.

However, the AFC wants the removal of the tax measure on private education to take effect in 2018. This comes in the wake of a recently-filed motion by the Opposition to have the VAT repealed with immediate effect. That motion is scheduled to be debated at the May 8 sitting of the National Assembly.

The party did explain why it wanted to seek a delayed removal of the tax. According to the AFC in a statement, Budget 2017 had a significant deficit. In addition to citing economic hardships throughout the hemisphere, the party claimed that the reduction of VAT from 16 to 14 per cent resulted in a net revenue loss of $10 billion.

“The Alliance For Change is cognisant and understanding of the difficult challenges faced by the APNU/AFC coalition Government in raising revenue to meet the national capital and current expenditures for 2017 at a time when there are difficult economic situations throughout the hemisphere,” the party said.

It stated that while the measure could have seen wider consultations, unpopular tax measures were sometimes necessary to meet revenue targets.

“The party has listened to those who have been affected by this measure. Having thoroughly reviewed all perspectives and extensively deliberated on the matter, the party accepts that education is a social good and, in ideal circumstances, tuition ought not to attract VAT.

“The party recognises that the measure of instituting Value Added Tax on private education tuition has been unpopular and has created some unexpected challenges for some parents of children and adult students attending private educational institutions,” the AFC added.

However, it expressed the view that the status of private schools required review. It thus called on the Government of Guyana to set up a task force to look into the matter in advance of the presentation of the Budget 2018 estimates.

In addition to weeks of protests in front of major Government buildings, parents had protested in front of AFC headquarters on April 24. Protesters had expressed the hope that the AFC could convince the Government to remove VAT from private school fees.

The parliamentary Opposition People’s Progressive Party/Civic (PPP/C) had submitted a motion to the Clerk of the National Assembly calling for the revocation of VAT on education. This came as parents continue to protest the tax imposition.

The motion is being moved by former Education Minister Priya Manickchand. In the motion, Manickchand calls for the immediate revocation of the 14 per cent tax on private education.

The particulars of the motion state that the impact of the onerous budgetary measures has caused great consternation and anxiety for parents and students and the future of students’ rights to access education of their choice, inclusive of private education, as provided for in the Constitution.

It is expected that the AFC will be put to the test when the time comes to vote on the motion to remove VAT, since it has expressed support to the frustrated citizens who have to pay the tax on education.

Hypocrisy

Meanwhile, veteran politician and former Government Minister, Dr Leslie Ramsammy has slammed the AFC for its “sheer hypocrisy” on the controversial issue of VAT on education.

According to him, the AFC has been resolute in its support for VAT on education. “Every time it counts, and their votes mattered, they voted 100 per cent in favour with President Granger, the Minister of Finance and APNU,” he charged.

“With public resentment and rejection at a high, AFC is seeking a way to speak on both sides of their faces. It is abhorrent and it is sheer hypocrisy. But they have one chance to redeem themselves – unequivocally support the PPP’s motion in Parliament to rescind the 14 per cent VAT on education. No “ands, if or buts”. Are the AFC MPs and Cabinet Members hypocrites? If the cap fits, they must wear it,” Dr Ramsammy posited.

He noted that with universal public outrage against VAT on education, “AFC is twirling in the wind, twisting like the American pretzel to find a way out of this political quagmire.” He further noted that the AFC voted for VAT on education not once, not twice, not three times, but at least four times.

“The AFC voted for approval of the budget estimates at Cabinet before Budget 2017 reached Parliament. When they did so, they knowingly — willingly, without reservation — approved 14 per cent VAT on education,” Dr Ramsammy declared.

Meanwhile, the anti-VAT on education protests are scheduled to continue Thursday in front of the Ministry of the Presidency.