My Budget is good business - Shaw
Published:Sunday | May 1, 2011 | 12:00 AM
Livern Barrett, Sunday Gleaner Writer
AMID GENERAL accolades and questions from analysts of the Budget presentation made last Thursday, Finance Minister Audley Shaw has sought to defend some of the administration's policy decisions he announced as "good business decisions" for the country.
Singling out the decision to extend the current agreement with the International Monetary Fund (IMF) by 24 months, Shaw said this sends the right signal to local and overseas stakeholders that the Government was serious about "holding the line" of fiscal discipline in the management of the country's affairs.
Shaw, who was speaking to journalists during his post-Budget press conference at the Ministry of Finance last Friday, said his administration will stick to its policy of fiscal prudence even with the looming general election, which is constitutionally due by October next year.
"We are not going to allow the prospects of a general election to stop us from holding the line and making sure that we manage the affairs of the country in such a way that it is sustainable going forward," said Shaw.
Staying the course
"Regardless of what happens in the general election next year, we have to stay the course. That is what we have to give to the Jamaican people," he added.
Pointing out that Jamaica had the highest motor vehicle duty rates in the region "by far", Shaw said this helped to fuel the widespread corruption in the importation of motor vehicles.
Noting that the decision to review the rates have been long overdue, the finance minister said this would have the twin effect of improving Government revenues from the importation of motor vehicles and significantly reducing the corruption.
"I can't guarantee that it will cut out all corruption, but it is going to cut down on corruption. It's going to cut down on the abuse of the concession system and, more important, it is going to allow people to consider purchasing a brand new car," he explained.
The finance minister said the raft of revenue measures announced during his presentation were designed to be "a kind of stimulus for the economy", but cautioned that the outcome will depend on the responsiveness of the private sector.
One key factor he pointed to was the removal of transfer tax and stamp duty on securities, adding that over 8,000 assets are now "locked up" between the Administrator General's Department, the Stamp Duty Office, the National Land Agency and the Supreme Court.
"This initiative I announced is to unlock those assets. Free them up so they can become a part of the economic profile of the country. Get titles freed up so they can be used a collateral, so new business contracts can be signed," he outlined.
"I expect that the revenues will be positive as a result of these initiatives, but we can't really project. There is always some difficulty in ultimately being able to say this is how the economy benefited," he said.
Shaw said despite the economic challenges, the administration has managed to expand the social safety net to provide more assistance for the less fortunate.
As an example, he said the number of beneficiaries under the Programme of Advancement Through Health and Education has jumped from 235,000 to 360,000.