Minister of Finance and the Public Service, Hon. Audley Shaw, says several key issues pertaining to economic growth strategies are to be discussed at this weekend’s Cabinet retreat.
Speaking at Mayberry Investments Limited’s first monthly Investors Forum for 2011, at the Knutsford Court Hotel, New Kingston, on Wednesday (January 19), he said key among these are matters pertaining to loan portability, implementation of the credit bureau, secondary mortgage market development and tax reform.
These issues form an integral part of the growth strategies currently being developed by the Planning Institute of Jamaica (PIOJ), on the directive of Prime Minister, the Hon. Bruce Golding.
The Finance Minister informed that last year, the Prime Minister instructed the PIOJ to establish a Growth Secretariat to develop the strategies. Arising from this, was a draft report entitled, “A Growth Inducement Strategy for Jamaica”, the contents of which he described as “encouraging”.
“Importantly, it addresses both the short and medium term, and points the way to a healthy partnership between the public and private sectors, (and) it is still a work in progress,” he said.
Regarding the matters for discussion at the retreat, Mr. Shaw cited that, in relation to loan portability, there is an urgent need to consider removing stamp duty on existing loans, as well as to move, post-haste, to implement the credit bureau legislation, for which regulations are shortly to be promulgated.
In relation to the secondary mortgage market development, he said that he is “actively” giving consideration to removing the transfer tax and stamp duty on corporate bonds and commercial paper.
“We need to get dynamism going in the whole area of corporate bonds and commercial paper,” he said.
Mr. Shaw cited tax reform as an “important plank” in the growth inducement strategy, while pointing to a review of the tax policy, which the administration is currently pursuing, for which Cabinet has issued specific directives.
“We want to reduce taxes, where possible. We want to eliminate a lot of the waivers that we have now. It is debilitating. It takes away from strategic thinking from being able to have the visionary outlook. We have to come up with a policy that is more equitable, and we believe that, as a concept, as a philosophical position, we need to look at reducing and eliminating waivers,” he said.
He said that compensation for eliminating waivers would be to reduce overall duties, so that instead of getting a waiver, persons would pay lower duties which, in turn, would elevate the level of compliance.
Mr. Shaw said, when approved and implemented, the growth improvement strategies will be a “powerful kick start” to economic activity, particularly in relation to several developments and programmes currently being executed.
These include: the US$200 million Falmouth cruise ship terminal; US$400 million Jamaica Development Infrastructure Programme (JDIP); the Palisadoes Shoreline Protection Project; and the redevelopment of downtown Kingston.
He noted that downtown Kingston was “coming alive”, with US$60 million being spent by Digicel to establish their corporate headquarters there.
“They have restored (a section of) the Coronation Market, and they are about to restore another section. We must all congratulate Digicel for this level of corporate social responsibility that they are demonstrating,” he stated.
Additionally, Mr. Shaw said Prime Minister Golding, working in conjunction with Energy and Mining Minister, Hon. James Robertson, has established a special team to ramp up the liquefied natural gas (LNG) conversion project. He said this is critical to reducing the cost of electricity, which would allow us to be more competitive.
CONTACT: DOUGLAS McINTOSH