Church, prostitutes and more - the next tax frontier

By Michael Abrahams, Online Columnist

There goes Peter Phillips again, shafting us with his big package. Tax package, that is.

The recently announced withdrawal tax has got to be one of the most unpopular and reviled economic measures ever proposed in the history of Jamaica. Many of us, including the prime minister, appear to be dazed and confused by it. It has been roundly rejected by the citizenry, including business leaders and civil-society groups. According to the leader of the Opposition, Andrew Holness, the tax would "disincentivise businesses" and open the door to other "brazen and thoughtless tax impositions under the guise of passing some IMF test".

It is easy to criticise and reject the withdrawal tax, but what are the alternatives? As a concerned citizen, I would like to offer my two cents' worth (which will probably be taxed) regarding measures to ease the country's almost $2-trillion debt. In this regard, I have four suggestions for serious consideration.

REINTRODUCE USER FEES FOR PUBLIC HEALTH CARE

We are an impoverished nation and need to awaken from our delusions of grandeur and accept the fact that we cannot afford to maintain free health care in the long term.
A Caribbean Policy Research Institute review of our public health system, undertaken in 2013, found the quality of service to be worse since the fee-less policy had been instituted in April 2008. The system was found to be ineffective, inefficient and exceedingly slow.

Yes, there are many destitute persons who present themselves for health care, but paying a minimal fee is not unreasonable to request and would ease the burden on the Government to pay health professionals and to pay for utilities, drugs, medical supplies and investigations.

LEGALISE, REGULATE AND TAX MARIJUANA

The legalisation of marijuana has the potential to generate significant revenue for Jamaica. Consider these statistics from the United States:
Following legalisation in Colorado, US$6.17 million was collected in tax revenue in just the first two months of 2014, with US$98 million projected in the upcoming fiscal year, of which US$40 million is to be used for public-school construction, while in California, medical marijuana dispensaries generate US$105 million in sales tax annually. On the other hand, marijuana prohibition costs state and federal governments US$17.4 billion every year.

LEGALISE, REGULATE AND TAX PROSTITUTION

The world's oldest profession isn't going away anytime soon. Prostitution is legal in the Netherlands, Switzerland and Germany, among other countries. In the abovementioned, sex workers are regularly tested for sexually transmitted infections and the system is regulated. The legal prostitution industry in Netherlands generates US$800 million (625 million euros) a year, the tax rate for sex workers being 33 per cent. In Switzerland, prostitutes pay VAT (value added tax) on their services and some accept credit cards. (I wonder how they swipe them.)

TAX CHURCHES

Jamaica has the most churches per square mile (make that per square inch!) in the world, with even more churches being built as you read this article. One argument that is used to defend their tax-exempt status is that they are charitable organisations, but they do not all possess that mindset.
I know a devout member of a particular church who has been paying tithes and offerings for many years. She 'buys and sells' for a living, and when her car trunk was broken into and her goods stolen and she went to her church for financial assistance, she got none. Another acquaintance of mine lost her job, and when she informed her church of this, explaining that it would negatively impact on her ability to contribute to the institution, she was asked if there wasn't anything in her house that she could sell in order to keep the contributions coming.

Now, is there any good reason why these organisations should not be paying tax? Not even a 'toops'?
Suggesting that churches pay tax while simultaneously suggesting legalising marijuana and prostitution will not go down well with my Christian friends, many of whom are already convinced that when I die I will be going in the 'down' elevator to the basement to hang out with Hitler, Jack the Ripper, and, of course, good old Satan. But in times like these, we must think outside the box, examine our options dispassionately, and engage in objective debate if we are to claw our way out of our fiscal abyss.

Michael Abrahams is a gynaecologist and obstetrician, comedian, and poet. Email feedback to columns@gleanerjm.com and michabe_1999@hotmail.com.