CAPRI launched its study on in search of the most efficient tax for Jamaica at a public forum on Tuesday November 13, 2018 at the Spanish Court hotel’s Worthington property. The think tank put together Mrs. Pamella Folkes, Deputy Financial Secretary, Taxation Division - Ministry of Finance and the Public Service; Mr. Hank Williams, Deputy Commissioner General, Strategic Services - Tax Administration Jamaica; and Ms. Allison Peart, Country Managing Partner and Tax Partner - Ernst & Young to join Dr. Damien King, Executive Director - CAPRI for a panel discussion on the study’s findings and this was moderated by Dr. Diana Thorburn.
Dr. Damien King asserted that the most expensive and least expensive tax of the three were Income tax and GCT respectively. The cost of administering the cost of Income tax was 2.6%, 0.2% property tax and 2.0% for GCT. Coupled with the fact that GCT is the most efficient tax with 81% being realized. Jamaica has a high informal sector, so reliance for raising tax revenue should be on value-added tax rather than income tax.
The presentation concluded with the following recommendations: pursue equity objective through public expenditure, perform tax gap analysis and reduce reliance on income tax. To live in an economy that is fair and equitable, there needs to be sufficient resources to finance the function of the government and meet social needs.