THE ANNUAL STOCKTAKING of the budget season coincides this year with new leadership on both sides of the political fence. This traditional parliamentary exercise may be influenced by the need to consolidate new power, which factor may be complicated by the likelihood of an early general election; and that could play a significant role in policy prescriptions shaping the manifestos the major parties will put to the electorate.
Notwithstanding his subsequent disavowal, Dr. Davies opened the Budget Debate last week with the anticipated "no new taxes" package, giving impetus to the expectation of impending elections. Indeed, tax relief in the significant agricultural sector was a highlight of his presentation.
We would like to think that our own launch at the start of the year of a Reclaiming Agriculture series helped to influence the latest policy initiative. Indeed the Government must have been aware of the intense lobbying by the farming sector since January to remove the general consumption tax (GCT) from agricultural imputs and equipment.
In our series on the state of the sector, there have been specific suggestions for tax incentives for companies to invest in rural areas by building factories to process agricultural produce.
Both the Jamaica Agriculture Society and the Jamaica Manufacturers' Association have been urged to lobby commercial banks to lower interest rates on loans to both their sectors of influence and operation. Additionally, property tax has been seen as a big disincentive by observers in the sector who see agriculture as a potential engine for national growth.
In January we cited a major contribution by Opposition Senator Anthony Johnson in the State of the Nation Debate in the Upper House to the effect that GCT was a burden on the agricultural sector. Statistics were cited to indicate the decline of bananas, for example, from Jamaica's 60-year dominance as the world's largest exporter to the point where the island is now short of fruit for export and to maintain its banana and plantain chip industry.
The effect of the tax reliefs on the sector remain to be demonstrated, bearing in mind that perhaps the biggest disincentive of all is still to be curbed. We refer to the incidence of praedial larceny for which the long-awaited receipt books to confirm the legitimacy of produce being transported to market is only now being made available to the genuine producers.
All these developments point to new hope for agriculture with all sectors seemingly committed to its revival.
THE OPINIONS ON THIS PAGE, EXCEPT FOR THE ABOVE, DO NOT NECESSARILY REFLECT THE VIEWS OF THE GLEANER.
