Joseph M. Matalon (left), chairman of the Tax Policy Review Committee, gets ready to make a presentation at the recent forum on the Tax Reform Proposals 2005 held recently at the Jamaica Conference Centre. Assisting him is Betty-Ann Jones Kerr (centre), tax partner at KPMG Peat Marwick and Partners. At right is Brian Denning, partner - tax services at PricewaterhouseCoopers. The forum was hosted by the Jamaica Chamber of Commerce's Jamaica Conference Board and PricewaterhouseCoopers.
THE TAX Policy Committee - chaired by Joseph M. Matalon - is proposing that the Government of Jamaica immediately opens discussions with CARICOM partners, aimed at reforming the Jamaican tariff structure. The committee is recommending a uniform tariff structure, with rates of say between five and 10 per cent.
According to Mr. Matalon, the Government of Jamaica cannot unilaterally effect the rationalisation of the tariff regime along the lines proposed by the committee for GCT, because of the nation's obligations under the CARICOM Treaty and the operation of the Common External Tariff (CET). Therefore, the reform would have to be a collaborative effort with CARICOM nations.
At present, he said, there were 10 basic tariff categories imposed in Jamaica and within each there were numerous exemptions and rates which vary widely. "The net result is that the existing tariff structure is highly variable and complex and lends itself to the machinations of those who would seek to subvert the system to their advantage," he said.
INCENTIVE LEGISLATION
In addition, Mr. Matalon noted that under the present incentive legislation, significant benefit is derived by organisations from relief and exemptions from import duties and other imposts at the point of entry. However, he was quick to point out that with the wide dispersion of applicable rates on imports, it was understandable that industries such as tourism could only remain competitive through tax exemptions, especially when operators in competitive destinations were benefiting in a similar manner.
"Indeed, this is why we have recommended that for the time being such reliefs continue to be granted," Mr. Matalon said.
He was addressing a wide cross section of businessmen at a forum on the Tax Reform Proposals 2005, hosted by the Jamaica Chamber of Commerce's Jamaica Conference Board and PricewaterhouseCoopers, held recently at the Jamaica Conference Centre, Kingston.
The participants also heard a tax practitioner's perspective on the Tax Reform Proposals from Brian Denning, partner - tax services at PricewaterhouseCoopers.
Taken from The Sunday Gleaner, March 27, 2005
