Benjamin Franklin once said, "In this world there is nothing that is certain except death and taxes". This saying is so true and especially here in Jamaica. The country has one of the highest murder rate per capita in the world, so if old age or disease don't do the job, then the criminals will send you to your final resting place. As for taxes, the Jamaican working class is burdened by taxes and now since the 2009 Budget presentation yesterday, we are now bracing to feel an unprecedented increase in taxation.
The biggest announcement of the Budget presentation was the increase on the petrol tax. the Government has announced that it will be adding JM$8.75 on each litre of gas purchases at the pump. No doubt motorists will start to feel the pinch similar to last year when oil prices skyrocketed to record breaking levels. Currently I pay a little over JM$57 per litre for gas, which based on my engine size costs me approximately JM$2850 to full my tank. With the increase tax, keeping the ever increasing price of gas constant, I will be paying JM$3287.50 to full my tank, over JM$400 more. No doubt motorists will be feeling the pinch when this new tax comes into effect, but the commuters will also feel the pinch as I am sure the bus and taxi operators will start calling for an increase in fares to offset this increase in their expenditure. I am now beginning to think more about getting myself a bicycle to ride to work. Think about it, won't need to by gas and I will get fitter as I pedal my way to work. But seriously, this is a huge dent in the pocket of motorists, especially since the price of gas is increase every week as our dollar devalues on a daily basis and the gulf oil reference increases. The government has said however, that a potion of the money collected from this tax is to go into road maintenance, but I won't hold my breath on that one!
But the taxes don't end there as the Government has announced other increases to fill the huge JM$18 billion hole in their budget. The government has also zeroed in on the already high 16.5% General Consumption Tax (GCT). They have proposed to place GCT on certain basic consumer items that currently don't attract GCT, such as salt, rolled oats, syrup, fish, cock and noodle soup. As if going to the supermarket and markets aren't expensive and stressful enough, it is to get worse when thise tax exempted items begin to attract GCT. Going to the supermarket has just got harder for everyone.
The Government currently charges 20% GCT on telephone bills and credits, but they have proposed to expand this 20% GCT tax to the phones themselves. Yes, once approved you will be paying not 16.5% on that new Blackberry handset, but 20% on the already expensive handsets. I guess we will now think twice about buying that new bashy cellphone and start appreciating and taking better care of the phone we now have.
I expected an increase in taxes, but these increases are rough, especially the gas tax and the addition of GCT on food items that now don't attract tax. I was hoping that the Government would have increased taxes on cigarettes, alcohol. I was also hoping that the Government would have increased the taxes on all those imported biscuits and cookies and products that we can produce locally. Of course they would have to lower the production costs for the manufacturers, but at least we would be producing and maybe even exporting some of our products, thus earning the well needed foreign eschange. But, the wolrd economy is in a bad state, and the Jamaican economy is in an even worse state. My fellow jamaican's it looks like yet rougher times are ahead, so band your bellies and prepare yourselves.
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