The Private Sector Commission in its official statement on the 2018 Budget has questioned government’s commitment to its vision of improving the quality of life of citizens.
The PSC observed that while there are measures that will have a positive impact on local businesses, it is concerned that distinctly absent are measures necessary to sufficiently reverse the negative impact of the 2017 Budget.
The Commission repressed its disappointment with the government’s silence in the 2018 budget on the need to build oil and gas capacity.
“Oil and Gas is around the corner. We would expect this Budget to have devoted a great deal more than seven paragraphs to the preparation of our country for an event which will hugely transform the future of the nation,” the statement noted.
The Commission further reasoned that the government should already be engaging the services of industry experts to negotiate and engage, as equals, with the multinationals such as Exxon.
“The budget is, however, peculiarly silent on this need to build our capacity.”
The PSC said it had hoped the government would use its 2018 Budget to address the change of the tax policy from zero rating to exempt and standard-rated goods and services, the VAT on electricity, the VAT on agricultural and mining machinery and inputs.
“We are disappointed that there is no clear policy enunciated for addressing a projection on the level of corporate taxation based on which the business community can reasonably plan future investment, a recommendation that we had urged the Minister to embrace,” the statement said.
The PSC wanted to see more done for several sectors including health and education, urging also systems to ensure return on investment, continued shortage and procurement breaches.
The PSC slammed government again over its apparent abandonment of Amalia Falls Hydropower Project, saying it offered no clear indication of the cost of investment in the energy mix and the future cost of energy per kilowatt-hour.
“There are of course other fundamentals that this budget should be addressing: the reallocation of resources, the reduction of inequality in income and wealth; ensuring economic stability; the management of public enterprises; reduction of regional disparities. The question is to what extent has this budget addressed these fundamentals?”
Meanwhile, another main private sector body, the Georgetown Chamber of Commerce and Industry, has joined the PSC to commend the government on what it believes are some steps in the right direction.
The Chamber said it is, however, displeased that the fiscal policy initiatives detailed in the budget did not provide stimulus to some main sectors of the economy, and particularly that there has been no reduction to corporate income tax rate, personal income tax rate or a raising of the tax threshold.
Additionally, the GCCI was hopeful that a clear plan would have been articulated in the way of job-creating investments and/or, facilitation of job-creating investments.
Also worrisome to the GCCI, is the fact that no elaboration of a strategy to absorb workers who will be displaced by government’s attempts at GUYSUCO’s divestment/curtailment.