THE EDITOR, Sir:
DOES THE government have a social agenda when it comes to vehicle importation policy, or is it just a matter of maximising tax intake? As with taxes on tobacco products, alcohol and gambling, all governments are probably guilty of a measure of duplicity. They have some commitment to moderating the consumption of such addictive goods using high taxes, whilst at the same time relying on their continued use to assure tax income.
Some say the measures in this budget may not even maximise tax intake, but that is not my concern here. I am more concerned about the social equity implications of:
- reducing the total tax on SUVs from 288 per cent to 180 per cent
- reducing the maximum age of imported cars from four years to three, and
- reducing the scope of vehicle concessions for government employees.
Although raising the tax on SUVs to 180 per cent will hopefully reduce one aspect of conspicuous consumption (albeit at the expense of those who genuinely use their pickups as trucks), reducing the tax on SUVs to a similar 180 per cent, whilst logical, can only do the opposite. We already have more expensive, showy cars on our roads than any other country. Do we really need more? Do we really need to spend valuable foreign exchange on such decadent luxuries when it might be better if more of our affluence went into job-creating, productive enterprise?
As for reducing the age limit on imported cars, this will reduce the availability of good, relative cheap vehicles. Now there are some who say we have too many cars on our roads, that we have already allowed the importation of too many cars. Well, I certainly regret the fact that we don't do better in terms of public transport, especially between Spanish Town/Portmore and Kingston. But to remove, or at least reduce, the source of the only real alternative (for the non-rich) is socially-divisive. It's sometimes not hard to guess which income group amongst us has the most say in government policy.
Fix up the railway, continue to expand the bus service and THEN curtail car imports. And curtail luxury car imports too. In both cases, our import bill would be reduced, and the environment (physical and social) improved.
Finally, I've never been very happy with the privilege afforded those more influential (and mostly better-paid) public employees who receive their 20 per cent concession when buying a car, ostensibly (sometimes genuinely) for their work. There is too much abuse and again it leaves out so many other deserving people who use their vehicles for their work.
In the private sector, however, the practice is even more widespread, with company cars provided, purchased at minimal tax cost as capital goods. So this is more difficult for me. If these vehicles are genuinely 'tools of trade', then a basic model could be insisted upon, i.e. a Corolla or Sunny, or equivalent, and then some lien be placed on its eventual resale value.
In conclusion, my point is that I would like to see the government use tax measures not only to raise revenue, but also to nudge out fragile social structure in a more equitable, and therefore sustainable, direction.
I am, etc.,
PAUL WARD
pgward@cwjamaica.com
Box 43, Kingston 7
Via Go-Jamaica
