Dionne Rose, Parliamentary Reporter

Opposition Senator Shirley Williams (left) in rapt discussion with Government Senator Professor Trevor Munroe during a committee sitting in Parliament. - File

The Senate on Friday approved legislation which will require persons who offer long-term savings instruments for sale to obtain prior approval from Government.

The passage of the Income Tax (Amendment) Bill was, however, not without controversy with Opposition senators Shirley Williams and Anthony Johnson objecting to some sections of the legislation.

According to Senator Williams, the bill was a disincentive to domestic savings and was intro-ducing further bureaucracy in the system.

Transferring responsibility

Though Government Senator Anthony Hylton, who piloted the legislation, argued that the amend-ments were non-controversial, Senator Williams objected to the amendment which would see prescribed persons having to obtain the approval of the responsible minister in respect of tax-free instruments relating to long-term savings, prior to the instruments being offered on the market.

"The proposed amendment, as I see it here, is an attempt to take the responsibility out of auditing from the Commissioner of Income Tax, who is responsible under the Income Tax Act, and transfer such responsibility to prior approval being obtain from the minister," she said.

The amendment to the act will also see tax exemptions given only on long-term investments made in Jamaican dollars, a move on which Senator Williams also recorded her strong objection.

"What do you think is going to happen when we bring legislation which does not provide any exemptions or incentives for a person who might have U.S. dollars?" she asked. "That person is simply going to move that U.S. dollar perhaps to other Caribbean territories."

She also objected to the removal of the granting of tax credits to companies on the issue of bonus shares, a proposal which the legislation would also establish.

"I will understand if you remove that tax on bonus shares for those persons listed on the tax exchange because you may wish to argue that they are getting a benefit," she said. "However, those who are not, why are you removing this?"

Wrong procedure

Meanwhile, Leader of Opposition Business, Senator Anthony Johnson, said the legislation should have gone to a Joint Select Committee for further discussions with key players in the industry.

"I am extremely surprised that the Government would have come in this manner with what is in effect a mini tax package at this time," he said.

Meanwhile, tempers also flared when Government Senator Professor Trevor Munroe implied that there seemed to be some divisiveness between the Opposition Senators and Opposition Members of the House of Representatives, whom he said had supported the bill.

But despite the earlier objections raised, the Opposition failed to call a divide to the clauses. The bill was passed unopposed and without amendments.

The legislation will now go to the Governor-General for his assent.