Gordon Robinson | Can government collect?
Published:Sunday | February 22, 2026 | 12:07 AM
So the “no new taxes” chorus has ended with Government projected to earn approximately $29.4 billion in fiscal year 2026/27 from new taxes.
Surprise! NOT!!
Last October 28, Jamaica suffered the most devastating assault on its infrastructure, business activity, individual livelihoods and wellbeing in history. The estimated damage assessment is US$8.8 billion - 41 per cent of GDP.
I told you (November 14; Do the Math) that available funding without borrowing totalled US$320 million so “borrowing can’t be avoided because, before Melissa, Jamaica’s economy was growing at 1.0 per cent per annum. So relief and recovery funding won’t come from economic growth especially with one-half Jamaica’s economy in tatters.”
On November 21 ( The Maths not mathsing) I listed other short-term realities. I pointed out additional building materials and food had to be imported; tourism revenues would fall; so “Inflation is set to bare its sharp teeth while Government revenues drop thus putting pressure on Government to revisit its ‘No New Taxes’ mantra.”
Anywhere you go it’s the same cry.
Money worries, money worries!
Yet, loud expressions of shock and horror abounded while the Opposition appeared incapable of resisting the temptation to play political football. The Observer quoted Mark Golding during his walk to Parliament’s opening:
“We’re concerned about that announcement because at a time when the economy has contracted, and growth has gone into negative territory, imposing taxes on the population is what you call a pro-cyclical measure; it tends to worsen that [economic] depression.”
Ya don’t say?
As I told you last year inflation and borrowing would cramp the economy. So, Christopher Columbus, it’s not clairvoyant to note “the economy has contracted, and growth has gone into negative territory”. We know. Real guidance comes from those not playing polytricks but proposing how to tackle that. Yes, pro-cyclical policies tend to exacerbate downturns BUT this is a catastrophic downturn. Some pro-cyclical policies are unavoidable. The issues are how and how much.
In November I warned you 60 per cent debt/GDP ratio was converted from achievable aspiration to pipe dream and, if we aren’t careful, could return to 90 per cent in three years. Already, debt/GDP has increased to 68 per cent but Fayval says she expects it to return to 60 per cent by 2030.
How?
Not by borrowing our way out of this! But, before proposing other remedies, we must monitor spending of borrowed funds. On November 14, I wrote:
“Reality check will tell you we’ll be borrowing a truckload of cash. Reality check will tell you it’s essential to have a bipartisan Oversight Committee to monitor and report on spending of borrowed funds. As expected, Auditor General is already on the accountability train but can’t do it alone.”
Well, she’s making a good fist of it and, as we’ve already seen from the Starlink report, there’ve been cases of at least over-zealousness under pressure of real life needs. It highlights not only the Starlink breaches but also a real need for emergency Procurement Rules reform.
Most importantly, it highlights the need for a broad based oversight committee including bi-partisan and non partisan membership so emergency spending can be a collective rather than government-only effort.
Don’t have a comfortable place of rest
or a nice car to drive.
money is the only answer
C’Mon man!
So I closed off on November 21;
“We need every hand on deck. We need every heart and mind focused on the ultimate objective namely to build back better at the least fiscal and psychological cost.”
Inclusion of new taxes is the only responsible way forward. So we must stop the political carping and chip in as best we can. The sole issue must be how those taxes are levied and whether other taxation targets would be better.
Mark Golding: “I understand that Government has some difficult fiscal choices to make…”
Do you though?
“…and I don’t want to pre-judge what they’re going to do…”
Readers, do you, like me, feel a “but” coming?
“but the approach of trying to tax your way out of the fiscal gap has some negative consequences that will flow from it….. So it’s a very delicate situation. I’m looking forward to hearing the specifics of it hopefully today.”
Government is NOT “trying to tax [its] way out of the fiscal gap”. J$29 billion is a drop in the bucket compared to the enormous budgetary hole anticipated. I told you (November 14): “Expect massive holes in the next two budgets because seismic expenditure shifts can’t happen immediately. There’s no magic wand. This isn’t routine…. This can only be done one day at a time; putting one foot in front of the other; believing; always moving ahead with eyes wide open. Rebuilding work can only follow rebuilding expenditure. Both…should comply with Audley ‘Are You’ Shaw’s favourite mantra ‘phase it eeeeen!’”
In 1979, at Jamaica’s economic nadir, Vernon Buckley and Gladstone “Son” Grant, a.k.a. the Maytones, released their biggest hit, Money Worries, commenting on the ordinary Jamaican’s plight. In 1849 French critic, journalist and novelist, Jean-Baptiste Alphonse Karr, coined the phrase plus ça change, plus c’est la même chose. If you play Money Worries again 47 years after its release you won’t need a French translator.
Think you got bad news in this budget? Well, worse news is coming next year with more new taxes AND more borrowing. Government is playing dominoes with a hand short three cards; holding four doubles. How does it navigate?
Let’s look at the new taxes.
1. GCT on “digital services” is so fraught with logistical, philosophical and legal difficulties that even Government doesn’t expect any return until 2027 which, in real life, means zero.
2. SCT of 2 cents per millilitre on non-alcoholic sweetened drinks. This’ll increase input cost by $20.00 per one litre bottle. Expect a retail increase of $57-$60 for your favourite diabetes supplies. Government expects $10.1 billion from a population half of which have no disposable income after Melissa and need only lifestyle change to negate the tax. Good luck with that projection.
3. Increased SCT on alcoholic beverages by $70 per litre of pure alcohol should rais e $1.6 billion. Nobody can complain about this or the cigarette “sin tax”.
4. Increased tax on cigarettes to raise $1.1 billion.
5. Government projects to collect $1.3 billion from removal of GCT exemptions on motor vehicle purchases for “designated public service positions”. Fayval said conditions causing the original concession “no longer prevail”.
What conditions? Who is “designated”? Will MPs keep their motor vehicle GCT exemption? What if “designated officials” can no longer buy cars?
6. Tourism activities’ GCT returns to 15 per cent. This should raise $11.4 billion
7. $3.639 billion more from an Environmental Protection Levy increase. Will this go to environmental protection?
Other than the sin taxes ( $12.8 billion), these taxes are discriminatory, politically convenient and uncertain of collection. Tourism taxes are also competition averse. Every Jamaican should share the bill so broader, more equitable strategies are needed. Maybe Julian can present constructive alternatives in March unlike current PNP Leader’s recent polytricking.
There’s a sneaky “new tax” hidden in plain sight. Government expects traffic fines collection to increase by 123 per cent from $450 million to $1 billion. Are motorists the latest police targets? There’s a stupidly erected traffic light at Lady Musgrave Road’s intersection with Montrose Road/Seaview Avenue used for tax collection by police who camp at a bus stop below Seaview ticketing drivers leaving that light; continuing on Lady Musgrave Road without unnecessary “right turn” indication.
Every driver so ticketed should contest payment. You can’t “turn right” from Lady Musgrave onto Lady Musgrave. You drive around a bend in the road as you would on Shortwood Road where it cuts across Olivier Road. Traffic lights facing Lady Musgrave (and campers) should be removed.
Peace and Love.
Gordon Robinson is an attorney-at-law. Send feedback to columns@gleanerjm.com