Minister of Finance and the Public Service, Hon. Audley Shaw, announced today (November 24), that he is currently preparing a Cabinet submission, which would outline reforms to the administrative structure of the tax system.
This, he explained, would seek to address key issues such as the separation of the process of domestic and international taxation, and positioning Ministries departments and agencies in this regard, in order to cauterise the incidence of tax evasion, and corruption.
“The Customs Department will be turned into an Executive Agency, and domestic tax administration will concentrate more efficiently on the critical areas… in which we will have a more sharply defined inland revenue service, sharply defined audit and assessment capabilities, and sharply defined compliance capabilities, because we have one of the highest rates of tax evasion and avoidance in the world,” the Minister said.
Mr. Shaw was speaking at the 15th annual International Development Partners (IDP) retreat at the Morgan’s Harbour Hotel and Marina, in Port Royal, Kingston.
Finance and the Public Service Minister, Hon. Audley Shaw (right), having a light discussion with World Bank representative in Jamaica, Mr. Badrul Haque (left), at the 15th International Development Partners (IDP) retreat, held at the Morgan’s Harbour Hotel and Marina, Port Royal, Kingston, today (November 24), at which Mr. Shaw was guest speaker. At centre is the German Ambassador to Jamaica, His Excellency Jurgen Engel.
“We fully understand that part of the challenge we face now is that we can’t reduce evasion by threats of law enforcement and punishment. I think, more importantly, it has to be achieved by encouraging the development of a culture of paying your taxes. It’s encouraging the development of good governance practices, good governance principles, in which people pay their taxes, and see the expenditure conducted in a transparent way,” Mr. Shaw argued.
The Minister said that in the Ministry, taxation reform is not just a reform of policy. “Perhaps, more importantly, the reforms that are needed in my tax departments are administrative reforms,… how can we make it more efficient, and how can we cut out the corruption. How can we stop the illegal registration of illegally obtained vehicles and you can only stop that when (we) cut the corruption from within our own organisation, and we intend to do that,” he asserted.
Noting that the administration’s efforts to this end have been “targeted,” Mr. Shaw pointed to the support which has been forthcoming from multilateral agencies, such as the United States Internal Revenue Service (IRS), and Treasury Department, and the International Monetary Fund (IMF).
“We are grateful for the support that we have been getting from so many of our partners and we are taking a voracious attitude and building a voracious appetite for technical support in this area,” he said.
On another matter, the Minister said there should be a revision in how the Government negotiates future Memoranda of Understanding (MoUs) with unions representing the island’s civil servants. Mr. Shaw contended that “for too long,” the MoUs have been discussed in a “vacuum.”
United States Agency for International Development (USAID) Mission Director in Jamaica, Dr. Karen Hilliard (left), converses with Executive Director of the Early Childhood Commission (ECC), Ms. Winsome Johns-Gayle (centre), and United Nations Representative in Jamaica, Mr. Minh Pham, at the 15th International Development Partners (IDP) retreat, held at the Morgan’s Harbour Hotel and Marina, Port Royal, Kingston, today (November 24).
“We only look at it as a vehicle to guarantee public sector increases every two years. Future Memoranda of Understanding will have to be looked at within the context of the relevance of Government and all its agencies, departments, statutory bodies and public companies, providing service to the people, and delivering service in an efficient manner,” Mr. Shaw said.
The Minister pointed out that the reformation of the civil service, as outlined by Prime Minister, the Hon. Bruce Golding, would be “one of the most comprehensive reviews of the role of Government and all its entities that we have seen in Jamaica for a very long time.”
He emphasised that every Ministry, agency and department “must justify their existence” and that every employee “must understand their role and we (Government) must understand their role, and how this fits into the big scheme.”
The retreat is being held over two days, and according to United Nations Representative in Jamaica, Mr. Minh Pham, it aims to promote frank and fruitful discussion among members of the global donor community, in order to “arrive at a cogent and co-ordinated approach in our support to Jamaican national priorities.”
The IDP comprises international donor agencies which have offices in Jamaica. These include: the United States Agency for International Development (USAID), United Nations Educational, Scientific, and Cultural Organization (UNESCO); the United Nations Children’s Fund (UNICEF), and the World Bank.