Minister Shaw Looks to Reduce Time Frame for Gov’t Access to Dormant Bank Accounts

Photo: Mark Bell Finance and the Public Service Minister, Hon. Audley Shaw (left), speaks with Young Entrepreneurs Association of Jamaica (YEA) President, Ricardo James, at a policy proposal forum staged by the association on April 12 at the Jamaica Promotions Corporation (JAMPRO) headquarters in New Kingston.

Story Highlights

  • Minister of Finance and the Public Service, Hon. Audley Shaw, is looking at reducing the time frame for Government to have access to dormant bank accounts.
  • Billions of dollars remain unclaimed in local financial institutions. Under the Banking Act, money in bank accounts that have been dormant for 15 years or more become part of the revenues of the Government.
  • Minister Shaw said the 15-year period is excessive and a proposal to reduce the time frame will be submitted to Cabinet shortly.

Minister of Finance and the Public Service, Hon. Audley Shaw, is looking at reducing the time frame for Government to have access to dormant bank accounts.

Billions of dollars remain unclaimed in local financial institutions. Under the Banking Act, money in bank accounts that have been dormant for 15 years or more become part of the revenues of the Government.

Minister Shaw said the 15-year period is excessive and a proposal to reduce the time frame will be submitted to Cabinet shortly.

He was addressing the Young Entrepreneurs Association of Jamaica (YEA) policy forum at the Jamaica Promotions Corporation (JAMPRO) headquarters in New Kingston, on April 12.

He was responding to a proposal from the group for the dormant funds to be used for the benefit of small and medium-sized enterprises (SMEs).

The Minister agreed that some of the funds could be made available to the SMEs for special programmes.

“The issue (of dormant funds) is very much on my radar… about $45 billion sits in dormant accounts and it has become an issue of controversy,” he noted.

Other proposals from the YEA include having SME representatives sitting on government boards; special taxes and incentives for small businesses; and establishing a special relationship with the Credit Bureau, where failure of the business would not affect their credit rating and ability to access loans.

As it relates to taxes and incentives, Mr. Shaw said that he could not make any commitments “but it is something that can be looked at, because we already have precedence for differential taxes”.

He indicated that regulated companies already pay 33 1/3 per cent profit tax and unregulated companies pay 25 per cent of profit taxes.

“We already have a differential interest rate system and, in fact, we go further in a recent amendment to the law…where corporate unregulated companies that would pay 25 per cent, if they file their returns on time, they can actually go down to 17 ½ per cent profit tax,” he pointed out.

Relating to the special arrangement with the Credit Bureau, Mr. Shaw noted that “it is a conversation that can be had” with the entity.

He urged the group of entrepreneurs to concretise and formalise the set of proposals and send them to him for closer examination.

The Minister emphasised that the Government is serious about putting business people “out in front”.

The YEA policy forum, held under the theme ‘Creating an enabling environment for SMEs to flourish and contribute to Jamaica’s economic growth and job creation’, provided a platform to examine matters for the sustainable development of the small-business sector.

YEA is a volunteer-driven non-profit organisation formed in 2005 under the auspices of the Jamaica Employers’ Federation. Its mandate is to advocate and support young people in business.

YEA represents business owners 18-45 years and provides their members with an opportunity to learn from their members’ experience and to take advantage of peer mentorship as they grow their businesses and lobby for an enabling environment for business growth.

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