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Story Highlights

  • The Bill was passed in the Senate on Friday (October 18) with two amendments, following its approval in the Lower House on Tuesday (October 15).
  • “This measure will enable a more equitable sharing of the tax burden by providing a platform for bringing more persons...who currently evade (paying) taxes... into the tax net,”
  • The Bill also proposes the imposition of a $1 million limit on cash transactions with financial institutions.

More persons are expected to be brought under the tax net consequent on the passage of the Proceeds of Crime (Amendment) Bill 2013, in both Houses of Parliament.

The Bill was passed in the Senate on Friday (October 18) with two amendments, following its approval in the Lower House on Tuesday (October 15).

Justice Minister, Senator the Hon. Mark Golding, who piloted the Bill in the Upper House, said the legislation will create a paper trail that will assist the tax authorities in collecting the critical revenues necessary for Jamaica to meet its economic objectives.

“This measure will enable a more equitable sharing of the tax burden by providing a platform for bringing more persons…who currently evade (paying) taxes… into the tax net,” he said.

Senator Golding noted that the Bill will also facilitate a more accurate measurement of the national economy, “which suffers for a massive understatement of our Gross Domestic Product (GDP) due to the huge informal economy operating outside (the) formal transactional and reporting systems”.

The Bill also proposes the imposition of a $1 million limit on cash transactions with financial institutions. This means that under the provisions for reporting suspicious transactions, engagements exceeding $1 million cannot be undertaken by anyone other than a “permitted person,” such as a bank or licensed financial institution.

“It is a fundamental enhancement of the law enforcement system to support the combating of serious crime under (the Proceeds of Crime Act) POCA, by limiting the ability to use raw cash to settle large transactions. Limiting the size of cash transactions will have the positive benefit of reducing the behavioural tendency among some business people to put their lives in danger by keeping large cash amounts,” Senator Golding said.

He noted, however, that this provision does not preclude persons from collecting several cash payments in bona fide transactions which, individually, are less than $1 million but total or exceed that sum. Similarly, the provision does not prohibit legitimate multiple transactions of less than $1 million each, but which add up to or exceed that figure.

“Indeed, this law will not prohibit anyone having more than $1 million on them, though of course, it is very risky to do so and it ought to be discouraged. It is only if a single cash payment exceeds $1 million that one party to the payment, that is, either the payer or the receiver, must be a commercial bank or other Bank of Jamaica (BoJ)-licensed deposit-taking entities or credit unions, or a licensed cambio. However, artificially splitting up a transaction into several payments to make the transaction appear to be below $1million will be prohibited,” Senator Golding explained.

The Justice Minister said the Bill also seeks to ensure that Jamaica is fully compliant with certain international requirements as it relates to money laundering and terrorism financing.

“Since 2005, Jamaica has taken several measures (including the passage of the POCA in 2007) to strengthen its framework for combating money laundering and financing of terrorism. Jamaica is required to continue to review its laws to ensure that we are compliant with the requisite international standards,” he said.

Other amendments to the Act include addition of an oversight regime for designated non-financial businesses and professions, such as attorneys, accountants, real estate dealers, and dealers in special metals and stones.

The Act also outlines the powers that designated competent authorities will have in relation to the role of compliance monitoring with the anti-money laundering requirements.

Amendments have also been made to the Bill to ensure consistency in term definitions used in the POCA with those outlined in the Financial Investigations Division Act.