Dear Editor,
The PNC’s proposal that only those earning above GY $400,000 monthly will pay taxes on the difference (i.e., only on the portion above GY$400,000) seems appealing on the surface, but it’s economically unsustainable, and may result in serious consequences for the country.
Taxes form a significant part of Government revenue, which is crucial for funding public services such as healthcare, education, infrastructure, and security. By exempting a large portion of the population from paying taxes, Government would face a massive shortfall in revenue. This means less funding for essential services and national development, which can lead to increased debt, cuts in public services, and even inflation if the Government tries to print more money to compensate.
The PNC’s proposal creates unrealistic expectations that the Government can function effectively with a reduced tax base. In practice, this is an empty promise because the Government would eventually need to either raise taxes in other forms (such as VAT or tariffs) or borrow heavily, which would hurt the same people they’re trying to help by increasing the cost of living.
Alternatively, critical services would suffer, leading to poorer quality of life, especially for the most vulnerable.
If only high earners are taxed on a small portion of their income, the system becomes overly reliant on a shrinking tax base. This places an excessive burden on a small group of individuals and companies, which could discourage investments, drive talent away, or force businesses to relocate, further weakening the economy. A broad and balanced tax system ensures that all citizens contribute to national development according to their means, spreading the burden more equitably.
The proposal suggests a short-term political strategy rather than a well-thought-out economic plan. It’s easy to promise tax cuts to win votes, but in practice, a country needs stable, predictable revenue streams to fund development. This policy would lead to budget deficits, higher national debt, and potential economic instability in the long run.
In conclusion, the PNC’s promise to tax only income above GY$400,000 is an unrealistic proposal aimed more at attracting votes than creating sustainable economic growth. While it might sound appealing, it would hurt the country by reducing essential revenues, creating unrealistic public expectations, and harming future development. It is a classic case of making empty promises without considering the long-term consequences.
Sincerely,
Robert Allicock
