House Approves Legislation on Telephone Tax

Photo: JIS Photographer The House of Representative.

Story Highlights

  • Legislation was passed in the House of Representatives on March 16 giving legal authority to the Government to collect taxes imposed on certain telephone calls since 2012.
  • The Bills, the Telephone Calls Tax Act, 2017 and the Telephone Calls Tax (Validation and Indemnification) Act, 2017, were piloted by Minister of Finance and the Public Service, Hon. Audley Shaw.
  • In 2012, it was proposed that $0.05 per minute would be imposed on calls originating and terminating on a public fixed network in Jamaica; $0.40 per minute would be imposed on domestic and international calls originating on a public network in Jamaica; and US$0.075 per minute would be imposed on all international calls terminating on a public mobile network in Jamaica.

Legislation was passed in the House of Representatives on March 16 giving legal authority to the Government to collect taxes imposed on certain telephone calls since 2012.

The Bills, the Telephone Calls Tax Act, 2017 and the Telephone Calls Tax (Validation and Indemnification) Act, 2017, were piloted by Minister of Finance and the Public Service, Hon. Audley Shaw.

The Minister explained that the Telephone Calls Tax (TCT) took effect on August 30, 2012 by way of a Provisional Order pursuant to section 3 (1) of the Provisional Collection of Tax Act.

He said the Order was not confirmed as stipulated by section (4) (a) of the Act, which posits that “an Order shall cease to have effect if it is not confirmed, with or without modification by Resolution of the House of Representatives, within the next 30 days on which the House sits after the date of publication of the Order in the Gazette”.

“It is proposed to validate the collection of the Telephone Calls Tax from the period August 30, 2012 and ending on the enactment date of the proposed Telephone Calls Tax Act,” Mr. Shaw stated.

“It is further proposed to indemnify the Government and all persons who, in good faith, collected the Telephone Calls Tax during the period to the enactment date of the proposed Telephone Calls Tax Act from any liability,” he added.

In 2012, it was proposed that $0.05 per minute would be imposed on calls originating and terminating on a public fixed network in Jamaica; $0.40 per minute would be imposed on domestic and international calls originating on a public network in Jamaica; and US$0.075 per minute would be imposed on all international calls terminating on a public mobile network in Jamaica.

Mr. Shaw said that since the 2012 Order, the stakeholders relied on a Technical Note rather than the Order.

He said that the Technical Note was provided by Tax Administration Jamaica and reflected the policy intent. It also provided guidance on how the tax would be administered.

“Whereas the Technical Note substantially interpreted what was in the Provisional Order, there were also some variances from the said Provisional Order. The differences were specifically in relation to the tax treatment of the 30 per cent exemption of free minutes, and a definition of who is an applicable taxpayer was also addressed,” Mr. Shaw noted.

For his part, Opposition spokesman on energy and mining, Phillip Paulwell, said the Opposition was in support of the two pieces of legislation.

The Bills were passed without any amendments and will be sent to the Senate for its approval.

Legislation was passed in the House of Representatives on March 16 giving legal authority to the Government to collect taxes imposed on certain telephone calls since 2012.

The Bills, the Telephone Calls Tax Act, 2017 and the Telephone Calls Tax (Validation and Indemnification) Act, 2017, were piloted by Minister of Finance and the Public Service, Hon. Audley Shaw.

The Minister explained that the Telephone Calls Tax (TCT) took effect on August 30, 2012 by way of a Provisional Order pursuant to section 3 (1) of the Provisional Collection of Tax Act.

He said the Order was not confirmed as stipulated by section (4) (a) of the Act, which posits that “an Order shall cease to have effect if it is not confirmed, with or without modification by Resolution of the House of Representatives, within the next 30 days on which the House sits after the date of publication of the Order in the Gazette”.

“It is proposed to validate the collection of the Telephone Calls Tax from the period August 30, 2012 and ending on the enactment date of the proposed Telephone Calls Tax Act,” Mr. Shaw stated.

“It is further proposed to indemnify the Government and all persons who, in good faith, collected the Telephone Calls Tax during the period to the enactment date of the proposed Telephone Calls Tax Act from any liability,” he added.

In 2012, it was proposed that $0.05 per minute would be imposed on calls originating and terminating on a public fixed network in Jamaica; $0.40 per minute would be imposed on domestic and international calls originating on a public network in Jamaica; and US$0.075 per minute would be imposed on all international calls terminating on a public mobile network in Jamaica.

Mr. Shaw said that since the 2012 Order, the stakeholders relied on a Technical Note rather than the Order.

He said that the Technical Note was provided by Tax Administration Jamaica and reflected the policy intent. It also provided guidance on how the tax would be administered.

“Whereas the Technical Note substantially interpreted what was in the Provisional Order, there were also some variances from the said Provisional Order. The differences were specifically in relation to the tax treatment of the 30 per cent exemption of free minutes, and a definition of who is an applicable taxpayer was also addressed,” Mr. Shaw noted.

For his part, Opposition spokesman on energy and mining, Phillip Paulwell, said the Opposition was in support of the two pieces of legislation.

The Bills were passed without any amendments and will be sent to the Senate for its approval.

JIS Social