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Finance Minister, Winston Jordan briefs his staff for one final time before this afternoon’s presentation of the national budget [Cullen Bess-Nelson photo)

Finance Minister, Winston Jordan briefs his staff for one final time before this afternoon’s presentation of the national budget (Cullen Bess-Nelson photo)

Today is Budget Day

 

By Svetlana Marshall

TODAY, the A Partnership for National Unity + Alliance For Change (APNU+AFC) Government will present its second budget amidst major expectations among Guyanese.

In August 2015, it had presented a $221B budget under the theme: “A Fresh Approach to the Good Life in a Green Economy.”

In that budget, the minimum wage went from $39,540 to $50,000, old age pensions were increased from $13,125 to $17,000 and all public servants above the minimum wage received a 5% increase. Those were just three of the many measures that positively impacted the man in the street.

Young entrepreneurs
In this year’s budget, the chances of a better life for all Guyanese are expected to go up with major attention to be placed on job-creation through micro-financing and the support of micro-industries to ramp up economic growth.

President David Granger had asserted that the budget would give entrepreneurs, particularly young entrepreneurs, an opportunity to participate in the economy. “Until and unless we get more young people into the economy, we won’t be able to see the type of growth [the country needs],” President Granger had said.

Reducing tax evasion
It was also explained that strong emphasis will be placed on stimulating the growth of the economy through increased revenue collection and the reduction of leakages through tax evasion.

Mega projects
Today, the Government is also expected to announce major plans for the infrastructural development of the country. In acknowledging the importance of infrastructural development, the President had disclosed that a number of mega projects will be executed this year, laying the developmental foundation before superstructures are built.

“This country cannot be developed without proper infrastructure; without proper highways and bridges, ferry stellings, aerodromes,and Harbour Bridges. If we are to develop this country, we have to have a solid infrastructural base before we can build superstructures. These will be addressed in the budget of the financial year 2016,” President Granger had said.

Opposition Leader Bharrat Jagdeo, who during his tenure as president never opted to raise public servants’ salaries by more than 5%, now wants to see a substantial increase in salaries for public sector employees reflected in the budget.
He is also calling for increased subventions for pensioners, a reduction of the Value Added Tax (VAT) – which he had introduced – from 16 per cent to 10 per cent, the reinstatement of the “Because we care” programme, reduced electricity rates and a reduction in vehicle taxes.

Unprecedented demands

Under the People’s Progressive Party/Civic (PPP/C) administration, both Jagdeo and his successor Donald Ramotar, had resisted lowering VAT; did not substantially increase public servants’ pay, and did not reduce electricity tariffs among the other demands being made now.

Embattled President of the Federation of Independent Trade Unions of Guyana (FITUG), Carville Duncan, on the other hand said that he would like the minimum wage to be increased from $50,000 to $70,000. Additionally, he said the income tax threshold should be raised.

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Budget 2016 to be presented today

– expectations run high as economy reaches new low

 

By Edward Layne

 

As the eight-month-old A Partnership for National Unity/Alliance For Change (APNU/AFC) coalition Government prepares to present its second National Budget, through Minister of Finance Winston Jordan later today, stakeholders are calling for tax reductions, a stimulus to jumpstart the economy and the creation of employment opportunities, especially for youths.

Finance Minister Winston Jordan

Finance Minister Winston Jordan

Speaking with Guyana Times ahead of the budget presentation, Economist and Political Commentator Ramon Gaskin said tax reform, job creation and economic stimulus must underpin the 2016 National Budget.
“I would like to see him do some serious tax reform. Tax rates in this counter are far too high. I would like to see him put in a stimulus package to jumpstart the economy to get it going again and to create jobs; I would like to see him do that.  But I don’t know if that is the direction in which he is heading,” Gaskin said.
However, the commentator said that he rather suspects the budget will be loaded with goodies, with Local Government Elections (LGE) less than two months away.
“I expect that the Minister will try to put in some goodies because we are on the eve of the Local Government Elections, that’s what I expect he will do…in terms of the overall economy of Guyana,  I don’t see a plan of the minister to stimulate  this economy and to create jobs. As you know rice is not doing well on the export side, sugar is a bad state with the bankrupt GuySuCo, the bauxite production has been down and prices are down and so is the revenue from logging, the economy is not performing well as I am aware, so I was hoping to hear from him some kind of master plan but I haven’t heard it,” Gaskin said.
Meanwhile, Executive of the Federation of Independent Trade Unions of Guyana (FITUG) Komal Chand said that he looks forward to a budget that is people-centered and brings the much needed interventions to jumpstart the ailing economy, as well as tax reforms.
“The promised reduction of VAT (Value-Added Tax), the increase of the Income Tax Threshold significantly. The threshold is $50,000 per month we asked for the threshold to go to I think $72,000 a month. We asked for the tax allowance not to be only restricted to the salary earner but also the spouse and children under 16….we are looking forward to the promise increase in wages and salaries that was made during the elections time to government employees. Of course old age pension, “ Chand said.
Private Sector Commission (PSC) member and tourism stakeholder Captain Gerald Gouveia told the Guyana Times that the PSC does not endorse calls for a reduction in the VAT.
“We believe that the mitigating taxes need to be adjusted, that is the lowering of PAYE (Pay As You Earn), the corporation tax. So in fact what we are talking about we believe the holistic tax reform needs to be done, we don’t subscribe lowering of the VAT. We also want to see that tax reform completed,” Gouveia said.
He added that the budget should also place heavy emphasis on tourism, specifically the marketing of Destination Guyana, as well as the promotion of investment opportunities in Guyana.
“I would like to see a lot more money put into the marketing of Guyana through Go-Invest and the Guyana Tourism Authority. I am looking somewhere between US$4M and US$5M. So I hope the government will demonstrate a very serious commitment to promote Guyana,” the businessman said.
Gouveia also called for increased public sector spending, which he cited as important to move the economy forward.
“Government needs to spend, Government need to go on a spending spree. We have too much money going back to the treasury at the end of reporting periods. I think that is extremely important,” he noted.
He also wants to see the Specialty Hospital and Hydropower featured prominently in the budget.
On Wednesday, Opposition Leader Bharrat Jagdeo indicated that Budget 2016 should include key measures to resolve a host of major issues currently affecting the economy, particularly satisfactory measures to boost consumer spending powers in order to stimulate the underperforming economy.
Jagdeo posited that Budget 2016 must feature major tax reductions, given that this is an outstanding campaign promise the Government is yet to fulfill and also because a significant drop in taxes can jumpstart to ailing economy.
Specifically, he suggested that the Value Added Tax (VAT) be reduced to as low as 12 per cent, as well as the lowering of excise taxes on foreign -used vehicles in face of the government’s announced plans to lower the excise tax on the importation of new vehicles.
Jagdeo also emphasised the need for substantial pay increases for Public Sector workers and advocated for a 35% increase for pensioners to cushion the government’s removal of the water and electricity subsidies for the country’s senior citizens.
He also advocated the reinstatement of the ‘Because We Care’ cash grant for public school students, support for the productive sectors like mining and agriculture.
Last August the government presented a $221 billion dollar three-month budget, even larger than what was presented in the past by the previous administration for the entire year.
However, a significant part of last year’s allocations were unspent as at December 31, 2045 and were returned to the treasury.  Many anticipate this year’s budget to be even larger.

FM

quote "“I expect that the Minister will try to put in some goodies because we are on the eve of the Local Government Elections, that’s what I expect he will do…in terms of the overall economy of Guyana,  I don’t see a plan of the minister to stimulate  this economy and to create jobs. As you know rice is not doing well on the export side, sugar is a bad state with the bankrupt GuySuCo, the bauxite production has been down and prices are down and so is the revenue from logging, the economy is not performing well as I am aware, so I was hoping to hear from him some kind of master plan but I haven’t heard it,” Gaskin said.

FM

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