In an attempt to pay down Jamaica’s massive public debt, the People’s National Party-led government proposed increasing taxes on items ranging from rum and hotel stays to telephone and electricity rates.
But the new tax measures, which are projected to bring in an estimated $266 million in revenue to offset the proposed $6.97 billion the government expects to spend this year, are being criticised by members of Jamaica’s Labour Party as not bold enough.
While presenting his party’s 2013/2014 budget before the country’s legislature last Thursday, Dr. Peter Phillips, the PNP’s minister of finance and planning, said that the tax increases, public service pension reform and other measures were needed because international lenders are reluctant to give the country any more money.
Though in 1984, Jamaica’s debt equalled 212 percent of the country’s gross domestic product, debt levels remain unsustainably high, at an estimated 128 percent of GDP as of March, Dr. Phillips said. In part because of that situation, Jamaica has experienced an annual average growth in income of only about 0.8 percent for the past 40 years, and the country’s average income per person remains the same as it was in 1973, the minister added.
See the May 31, 2012 edition for full coverage.