Budget 2018 - The Big Lie Exposed
2018 promises no relief for rankand-file Guyanese citizens and the private sector. The BIG LIE by Finance Minister Winston Jordon that “there will be no new taxes” has been exposed. The stark truth is that there is absolutely nothing left to further tax. The truth is that the PNC/APNU+AFC Coalition has already over-taxed the nation as of Budget 2017.
The extension in 2017 of the VAT to education and health services, and also to heavy duty agricultural machinery comes easily to mind. So, too, does the taxes on forestry products and electricity, which has driven up local manufacturing costs, as reflected in the lamentations of the GMSA as expressed by its President, Mr. Shyam Nokta, during the Association’s pre-budget consultation two weeks ago with the Minister of Finance. The critical Forestry sub-sector declined by 18.2% at mid-year with only sawn wood showing positive growth.
The new tax measures introduced in Budget 2017 have impacted negatively on the manufacturing sector, leading to increases in prices and reducing cash flow in some instances. This sloth in general economic activity, according to Mr. Nokta, is of concern since it is directly linked to non-performing loans, which increased from the corresponding period in 2016, for the manufacturing sector and services sector by 17% and 23.3% respectively. He could well have added a word on behalf of new home owners who now have to bear significant increases in the cost of construction material.
The vigorous housing drive inherited from the PPP/C has stalled.
The PPP/C had long recognized this emerging problem and called for the withdrawal of these new burdensome taxes and in their place the introduction of incentive measures to stimulate local private sector investment and economic activity. The PPP/C has committed to withdraw ALL these new tax burdens immediately following its victory at the 2020 General Elections.
But the current sloth in economic activity is not the only “sloth” of grave concern to Guyanese, as they contemplate these hidden burdens of Budget 2018.
The other worrisome “sloth” that is plaguing the PNC/APNU+AFC Government is in implementing its very own plans and projects. And, as we are constantly reminded by former President Jagdeo, those national transformational infrastructure projects were inherited from the PPP/C, fully funded and in many cases up and running. The CJIA Expansion Project, the Road Improvement Projects on the ECD, EBD and the Parika-Vreed-en-Hoop stretch.
In very recent days, we have noticed very sluggish and fitful reopening of works on the ECD Highway in the vicinity of Better Hope and a few villages beyond.
The Finance Minister recently lamented that the implementation rate is in the vicinity of only 30%. That is to say the “non-implementation” rate is a hefty 70%.
Some “sloth” indeed!
A “champion sloth”, indeed!
The root cause of this phenomenon is poor general and sector leadership and pandemic corruption. This means Guyanese will enter yet another festive season in a precarious position.
The festivities will mask the dilemma caused by poor general and sectoral leadership and rampant corruption. The lights, glitter and frolic of the season may mask the effect now, but observant Guyanese business people on Regent Street, Water Street and in the markets are already noting the decline in purchasing power as recorded by poor sales.
During my recent “walkabout” and various interactions in these and similar areas, this has been the recurrent observation of seasoned businesspersons. Several noted that “the Christmas ‘feel’ ain’t there “.
And indeed this is visible in the absence of the customary shop-front Christmas decorations and seasonal music in the commercial areas of the City. By mid-November these features of the festive season are usually very visible and audible.
These decorations and musical entrainment are “sales pitches” and come at a cost to the individual proprietor aimed to attract customers and beat the competition. The purchasing power to support the sales is just not there. The shop owners and large businesses this year are as a consequence understandably reluctant to invest in the customary attractions. Even the “masquerade bands” are silent and invisible!
The effect of the coalition’s closure of Wales Sugar Estate and reduction of activities at others have compounded this situation. Fortunately, there are indications that the Coalition will not send home more sugar workers as of now.
The main Trade Union in the industry has noted this stay in execution of the coalition’s onslaught on sugar, its workers and their families and communities. The Government has decided to put a hold on the closure of the East Demerara and the Rose Hall Estates until some time in 2018. This means the thousands of sugar workers, their families and communities are no longer threatened with the bleak festive season now visited upon their colleagues in Wales and adjacent communities.
But this must be seen as a custody of struggle and solidarity. Recall the massive march and rally in Canje a few months ago. This was the largest workers’ protest in decades. It attracted the widest cross-section of solidarity and active participation from teachers, shop-owners, taxi-drivers, professionals and residents of Canje, Corentyne, New Amsterdam. Thousands marched. This powerful peaceful protest came in the wake of the crippling closure of Wales by the Coalition and its announcement of the then imminent closure of the East Demerara and Rose Hall Estates. This action was openly and fully endorsed and supported by the People’s Progressive Party. This was a victory of organized popular protest to protect the legitimate interest of masses of Guyanese against the Fat Cats in the Coalition. The Coalition was forced to back down. The PPP has committed to immediately, following its victory at the 2020 Elections, to reverse the wrongs done to the Wales workers, their families and communities. This can be practically taken as a major point of the Party’s Manifesto for those Elections.
In the meantime, material support for Wales’ workers, their families and communities must be vigorously pursued. The Diaspora is already actively contributing and making more efforts to structure and expand this contribution.
Last week, Mr. Mithuall Mangal, former heavyweight in GAWU and the sugar industry and currently active in the NYC Guyanese community was in Guyana to this end. He visited Wales and did a needs assessment. The Diaspora is responding with solidarity and material support for Wales.
On Thursday, 23rd November, another influential Guyanese-born Real Estate Manager from NYC was in Wales to explore options and further material assistance.
Getting It Right understands that this particular instance some 300 food hampers are on the cards for Christmas. Such examples must be noted and followed.
Wales has been a wakeup call.
Wales has been a rallying call.
Guyanese have responded.
The Diaspora is mobilizing.
The Regent Street, Water Street and businesspeople of the various markets should seriously consider using the dollar-savings from the foregone decorations and glitter and festive shop fronts to procure food-stuff and other useful items and donate these in the form of substantial hampers to the Wales workers and their families. These small efforts, if sustained will go a far way in giving.
By all indications, the APNU+AFC Budget 2018 will bring no relief.
Budget 2018 will be presented on November 27th by Minister of Finance, Winston Jordan.
In the meantime, the PPP/C is fully mobilized for the Budget debate. The Party will expose the sleight of hand of the “no new tax” claim by Jordan. It will explore the data published by the Ministry itself in its recently released “National Public Debt” document to underline the steep and steadying economic activity over the past two years.
The debate should be followed closely. The true anti-working people of the Granger/Nagamootoo cabal will be fully exposed.