GOVERNMENT COLLECTED approximately $4.2 billion in revenue for the financial year 2003/2004 and registered some 4,114 new taxpayers, said Senator Deika Morrison, Minister of State in the Ministry of Finance and Planning.
This achievement is largely due to the significant changes and developments in Jamaica's tax administration landscape since the commencement of the Tax Reform in 1994. These changes have literally gone unnoticed, observed Senator Morrison, who was addressing the scores of persons who attended the Tax Services Exposition put on by the Management Institute for National Development and the Ministry of Finance and Planning last Wednesday.
"There has been, and continues to be, a process of monumental change. Change that has been informed by dialogue with stakeholders and taxpayers," asserted Senator Morrison.
SUCCESSFULLY TRANSFORMED
Chief Executive Officer of the Management Institute for National Development (MIND), Maria Jones agreed with Senator Morrison and indicated that this was one of the reasons for her institution's involvement in the staging of the Tax Services Exposition. "The Government has successfully transformed an entire area, and MIND wants to herald that achievement," she pointed out.
Some of these improvements include increased computerisation of many of the taxation systems, staff training changes, and extensive post reclassifications in keeping with organisational restructuring, and improvements to the legal and regulatory framework to address the challenges inherent in a liberalised economy.
"We have implemented the Integrated Computerised Tax Administration System (ICTAS), now 85 per cent complete, which has revolutionised the speed and accuracy of transactions, and significantly reduced the bureaucracy of trade transactions," the Senator outlined.
Director-General, Clive Nicholas also pointed to the various infrastructure modifications in the tax administration sector.
"If you look at the tax offices, which we have today, we call them revenue centres... all of these revenue centres are very modern tax offices. They are the tax centres of the future. In addition, the Customs Department is a much more modernised department and people are now able to file C78 returns and pay taxes electronically, and can also submit import entries before their goods arrive," said Mr. Nicholas.
There is also the one-stop Tax Compliance Certificate. "For a very long time the business community has been crying out for this as a much easier method of obtaining a TCC and we now have a system whereby you go to one location and get everything done instead of running around from place to place," added Senator Morrison. These changes have altogether improved tax collections in the past year, said Senator Morrison, and should go a long way to achieving significant growth in revenue from year to year by "reducing tax evasion, rooting out corruption, promoting transparency, encouraging voluntary compliance, strengthening surveillance, border control and protection, enhancing commercial trade and promoting investment."
On the issue of tax collections, Senator Morrison acknowledged the public concern about the 'informal economy', and Government's seeming inability to collect taxes from this group.
The informal economy officially defined has two categories explained Senator Morrison. Firstly, there are the legal enterprises that are in the tax net but are not reporting accurately and/or paying over all that is due to the Government. Then there are the illegal enterprises that are not in the tax net because they have not registered their businesses. "Companies in both categories enjoy an unfair advantage relative to companies that are operating with full compliance with the tax authorities. For those persons in the informal economy, please note that we have intensified our efforts to bring you into the net," warned Senator Morrison.
Mr. Nicholas also sought to allay the fears of the taxpaying-public that there are persons slipping through the cracks.
"The fact that we are now very highly computerised means that now we have a lot of information, and information is key to Tax Administration. You hear people talk about the informal sector, and when they talk about the informal sector they are talking about people who sometimes are very successful, earning a lot of income. Those are the people importing a lot of expensive cars, and we have that information. Those are the people who are purchasing expensive property, and those transactions pass through the stamp duty and property tax departments and we have that information," Mr. Nicholas outlined.
SEVERELY LIMITED
According to Senator Morrison, "Without an effective and efficient tax administration system, the ability of tax policy to achieve the primary intended goal of raising revenues in an equitable manner is severely limited.
"There is a comprehensive tax policy that is taking place, precisely because the system had got so complicated with all the incentives and different types of taxes that we have, and we are looking into all aspects of taxation and that will be finished by the end of this calendar year," Senator Morrison told JIS News.
"We have a genuine opportunity to break the negative and destructive cycle of cynicism and distrust. The gains we have made as a nation have been influenced by the demonstrated partnerships created and nurtured between associations," she said.
"This tax administration system does not belong to the government; it belongs to the people who have paid for it, the people who continue to pay for it and the people who will benefit from the gains in revenues, trade and investment as a result of increased efficiency, effectiveness and equity... those people are all of us," she stressed.
