Tax Hikes Cause Uproar in Jamaica

February 14, 2013 Taxation in Jamaica

JamaicaKINGSTON – Jamaica could soon introduce a series of tax hikes, despite the proposal being met with strong opposition from members of the national Parliament.

As part of the government’s ongoing efforts to raise overall revenues, on February 12th the Minister of Finance of Jamaica Peter Phillips made an announcement during a debate at the House of representative revealing several proposed tax changes aimed at raising an extra JMD 15.9 billion in tax revenues per year.

Amongst the changes announced by the Minister is a hike to stamp duties from 3 percent to 4 percent, an increase to dividend taxes from 10 percent to 15 percent, and the expansion of the General Consumption tax system to include telephone calls and fees paid at ship ports.

Companies with gross incomes exceeding JMD 500 000 will also be required to pay a new 5 percent surtax on their incomes.

The national Education tax will also be raised, increasing from 3 percent to 3.5 percent for employers and from 2 percent to 2.25 percent for employees and self-employed individuals.

The Minister explained that the proposed package of tax changes was necessary in order for the government to meets its obligations to the International Monetary Fund, the Inter-American Development Bank and the European Union.

The proposed tax measures were met with near-instant outcry from some members of Parliament, with almost all of the Opposition walking our of the sitting of the House of representatives before its conclusion.

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