- The new flat tax for the public transport system is intended to make the process of paying taxes easier
- The move will eventually result in the further formalisation of the public transportation sector
- Those who wish to continue to file their annual tax returns can do so
Minister without Portfolio in the Ministry of Transport, Works and Housing, Hon. Dr. Morais Guy, says the new flat tax for the public transport system is intended to make the process of paying taxes easier.
“I want to make it absolutely clear that this new system is not a draconian measure, as some want to suggest. It is a measure that is an alternative to filing your returns,” the Minister said at a press briefing on July 23 at the Ministry’s Maxfield Avenue offices.
“Most taxi operators can’t be bothered (or don’t have the time) to go into the Tax Administration (TAJ) offices before the 31st of the March each year to file a return. What has been brokered is something that will…make life easier for them,” he added.
Under the new system, transport operators will pay one flat annual rate, which will cover income tax, education tax, National Housing Trust (NHT), and National Insurance Scheme (NIS) contributions.
According to the Transport Ministry, the move will eventually result in the further formalisation of the public transportation sector as bus and taxi operators will ultimately contribute to statutory tax schemes.
Dr. Guy also explained that taxi and bus operators are not being forced to pay the flat rate, as those who wish to continue to file their annual tax returns can do so.
“We have been advised that a little over 50 per cent of the operators in this country file tax returns, while about 48 per cent do not file anything. We are facilitating a process, which makes it easier for this 48 per cent, and those among the 52 per cent, who file on a regular basis, who want to come on board to the new system,” he stated.
The Minister informed that the TAJ has made arrangements to ensure that the system is easy and flexible. As such, he said, the agency will facilitate the collection of all the necessary taxes and contributions and pay them over to the relevant entities.
“They have also indicated that they will make a window available at the Transport Authority for them (transport operators) to go in and make payments and TAJ will also have roving teams going into the offices of the various associations to collect payments,” he informed.
He further noted that the new system will not only redound to the benefit of the country and the transport system, but also to the operators.
“Only two (among the four payments) are actually taxes – the education tax and income tax. The other two are contributions, the NIS, which contributes to retirement or disability benefits and the NHT, which makes taxi operators and their families entitled to certain benefits whenever they apply to the NHT,” the Minister said.
Dr. Guy further emphasised that all Jamaicans, have an obligation to contribute to the development of the country by paying their taxes.
The new tax system was arrived at following a series of talks with representatives from the Ministry, the various taxi associations, TAJ, NHT and the NIS.