By Damion Mitchell, Staff Reporter
BUSINESS LEADERS decided yesterday that they would take action to have the Government withdraw the controversial four per cent cess on imports, despite its insistence that the tax is crucial to the budget.
Beverly Lopez, Private Sector of Jamaica president, yesterday reiterated the PSOJ's position that it was "unreasonable to implement tax measures prior to a company making a profit". She was speaking to The Gleaner, following a meeting of members of the PSOJ and other business leaders to discuss their next move against the cess.
Mrs. Lopez said that the PSOJ would be "taking several different actions" to vent its disapproval with the cess. However, pressed for details, she refused to elaborate stating, "I am not in a position to tell you that right now."
The Jamaica Chamber of Commerce in a news release yesterday, said that as a result of Government's decision to keep the cess, price increases of between 6 and 8 per cent were likely. Additionally, it said, the viability of businesses would either be hampered or destroyed.
In an interview with The Gleaner, Mrs. Lopez said that the Government's decision not to review the cess on imports was not "surprising."
RECOGNISED THE PROBLEM
She said the business leaders left their meeting with the minister on Monday "with an understanding that he recognised the problem that the tax would create." But, she said that the PSOJ was never optimistic, nor confident, that the situation would be favourably addressed.
Following Monday's meeting with Dr. Davies, the PSOJ said that the minister had given its representatives an assurance that he would be looking at possible compromises to the cess, when he closed the budget debate on Wednesday.
However, Dr. Davies said Wednesday that the government had a need to keep the cess. It became effective yesterday.
Clarence Clarke, president of the Jamaica Manufacturers' Association, said his major concern remained that the cess would not be refundable. At Monday's meeting, it was proposed that the cess on raw materials and capital goods be deferred. He disclosed that business interests would be seeking another meeting with the Finance Minister, but he declined to comment on what other actions were being planned.
RESOLVING THE ISSUE
Hendricks Porter, head of the Jamaica Customs Brokers' Association, said last week that the best approach to resolving the issue of the cess, would be to encourage dialogue. He said that, he too, was not surprised by government's decision to go ahead with it.
On Wednesday, customs officers in Kingston and Montego Bay worked up to midnight clearing entries, which were already in the system, ahead of yesterday's cess application date.
Janet Smith, public relations manager in the Customs Department, said it was necessary to clear up the backlog prior to the implementation of the new system. She reported that in Kingston alone, 582 motor vehicles, or 250 per cent above the normal daily amount, were cleared while 1027 items of general cargo were passed.
Although unable to give the direct figures for Montego Bay, she said that on Wednesday, the department collected $165 million in duties. This figure was above the daily average collection, which normally ranges between $100 million and $90 million.
The Jamaica Chamber of Commerce says it is disappointed with the Government's decision to go through with the cess on imports. In a news release yesterday afternoon, the chamber said, "It is manifestly immoral for Government to make the assumption that any individual business will be profitable in a given year," and noted that the cess insisted that an advance payment on the "profit" is made.
