Minister Urges Growth to Meet IMF Targets

KINGSTON — Minister with responsibility for the Public Service in the Office of the Prime Minister (OPM), Senator the Hon. Arthur Williams, has called for more investments, across all sectors, to meet International Monetary Fund (IMF) commitments.

Speaking at the Kiwanis Club of Montego Bay's 45th Anniversary meeting at the Wexford Hotel, on Thursday September 8, Mr. Williams noted that Jamaica has no alternative but to grow, as the International Monetary Fund (IMF) was holding the country to recent fiscal commitments.

"In 2009, when we began to have discussions and negotiations with the International Monetary Fund, the country’s Public Sector Wage Bill was 11.75 per cent of our Gross Domestic Product, (GDP).  By international standards, the public sector wage bill, as a percentage of GDP, should not exceed 9.5 per cent,” Mr. Williams explained.

"In the agreement that we had with the IMF, we agreed to reduce that ratio to 9.5 per cent by the year 2014 and, in our own legislation, in seeking to introduce a fiscal responsibility framework for the country, we put it in our waiver that the wage bill to GDP ratio should be reduced to 9 per cent by 2016, and the IMF is holding us to that”, Senator Williams noted.

He said that meeting the target by 2016 will depend on the level of growth in the company, in the next few years.

"We have to seek to earn more revenue, and we have to ensure that there are more investments in the country to generate the economic activity that will allow us to earn more revenue,” Mr. Williams stated.               

He also noted that Jamaica’s tax system appeared to be one of the most complicated in the world, but added that moves were underway to simplify the system.

"Fortunately, the Government in April tabled in Parliament a Green Paper on tax reform, and the parliamentary committee will begin deliberations on that Green Paper in short order, under the chairmanship of Finance Minister Audley Shaw,” Mr. Williams noted.

He said that it was compulsory that some progress is made in this area, as there is a need for a simplified tax system, as well as the early introduction of lower tax rates.

By Glenis   Rose, JIS Reporter