Worst budget in history of budgets – Jagdeo

first_img…will cripple economy, kill Private SectorFollowing an almost joyous declaration of a reduction on Value Added Tax (VAT) and then swiftly the announcement on the extension of VAT payments on water and electricity bills, Leader of the Opposition Bharrat Jagdeo at a press conference immediately after the presentation of the 2017 National Budget, remarked that the Budget will kill the private sector and unleash untold hardships on the nation.Opposition Leader Bharrat JagdeoCiting that this was the worse Budget he has ever had to sit through, Jagdeo argued that the incorporation of taxes is the highest he has ever seen with the capability to destroy any possibility of a recovery of the country’s economy.“We have heard over three hours of budget presentations and we have not heard of a single set of activities that the ordinary man can think about or bring more jobs to them or address their concerns,” he said, adding that the Government has established several slush funds that are being used for partisan political activities. “Like how they used $50 million for Local Government Elections just to travel to the interior…,” he highlighted.He questioned if there was anything within the Finance Minister Winston Jordon’s 2017 Budget presentation that represented the interest of the people, remarking that it is nothing but a “taxation budget” that will destroy the nation and people.He stated that when he began to listen to the presentation, he did not intend to make a derisive appraisal on it; however noticed that the Budget was immensely unresourceful.According to the Opposition Leader, when the presentation was winding down, his assessment changed from immensely unresourceful to “immensely ominous for the future of Guyana, for the future of job creation and growth and business development and for the future of welfare of ordinary people.”Terming it clichéd, Jagdeo stated that the presentation was “rehashes of old information,” inclusive of project ideas that were indistinct.He commented on the proposal to start the road from Georgetown to Lethem, stating that no feasibility study has been done and even the pre-feasibility study that was carried out pointed out that given the traffic flow between Brazil and Guyana that it is unsustainable to spend US$400 million to build the road.“A lot of these ideas were not well thought out… a lot of them, as you look at the framework of the budget, you would see that it is not supportive of growth,” he explained to the media.He stated that Jordon mentioned that Guyana will be issuing local bonds to finance the fiscal deficit, and while it appeared to be an innocuous statement, behind it is a fundamental economic philosophy and a departure from the norm.“The minister talks about creating more opportunities for the private sector but now the Government having announced this new budget will be going into the local capital markets to raise funds to finance the Budget. What this will do is that it will compete with the private sector for funds because they will both be seeking funds from the same market.”He also stated that a lot of people will be discouraged in investing because the State will be sucking most of the liquidity in the system.While he stated that people will not address this issue, it has the possibility to destroy any economic and long-term growth: “They will talk mainly about the tax measures introduced in the Budget and the implications of a lot of these measures will not be recognised for several days into the future.”“We heard for example the minister fulfilling a promise to the electorate on reducing Value Added Tax (VAT) from 16 per cent to 14 per cent but in the same breath they have decided to extend VAT payments to water bills and electricity bills above a certain level,” he added, arguing that there is a long list of exemption items that the former PPP government had put in place because they affected poor people and now these items have now removed.“So those items like baby milk and things people consume on a daily basis now become VAT-able. Now they have to pay 14 per cent VAT on it. When your electricity bill goes above $10,000 you now have to pay VAT on the full amount. How could this be helpful to anyone? There are so many issues, it is impossible to mention,” he said.Jordan in his Budget 2017 presentation has proposed the reduction of the Value Added Tax (VAT) from 16 to 14 per cent and in the same breath proposed 14 per cent VAT to be added to electricity bills exceeding $10,000 monthly and water bills exceeding $1500 monthly.Jordan’s announcement was received by angry shots of reproof from the Opposition benches, however he held forth that the application is a promise to alter the arrangements for VAT made in his party’s Manifesto.last_img

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