PRIORITY TASK IS TO COMBAT INEQUALITY

Feb 15, 2015 AFC Column, Features / Columnists

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By Moses Nagamootoo and Sasenarine Singh
Guyana has an extremely unequal distribution of income and wealth.  The National Bureau of Economic Research disclosed unsatisfactory income and consumption expenditure distribution in our society. Jamaica, Barbados and Trinidad all tested better than Guyana on the measure of inequality.
Other measures of inequality, as cited from the World Bank, illustrate that in Guyana “the richest 20 percent of the population controls 50 percent of the income, while the poorest 20 percent only controls 4 percent”.
This reprehensible track record of the Jagdeo/Ramotar PPP regime clarifies our prognosis that this cabal continues to take our people for a ride on their highway of unending poverty.
As was dramatized in the tiff between Kaieteur News publisher, Mr. Glenn Lall and the Commissioner-General of the Guyana Revenue Authority, selective enforcement of tax regimes tend to ease some and squeeze others. This would foster greater inequality of income and wealth between the rich and the poor.
MENU OF TAX MEASURES
In 2011, the AFC put forward a menu of tax measures to attack this imposed regime of inequity. Sadly, the do-nothing regime simply continued the economic malaise in the nation, and compounded it with increased financial waste and squandermania. The visionless regime simply held out several ill-designed, Ponzi scheme projects, as “mega development”.
Without any shame whatsoever, the regime admitted that it lost $900 million in a glorified fraud in the Specialty Hospital fiasco. Instead of accepting blame, the regime blamed the AFC for the criminal waste of our valuable financial resources on a fly-by-night project in which the contractors only showed a dozen heaps of dirt (which were dubbed “the Dirty Dozen”) at the Turkeyen location. Those heaps cost us $900 million.
The drain on public resources which could be better spent on job creation, agrarian and manufacturing expansion and youth skills promotion, has been exemplified by the $47 billion dumped on the Skeldon Sugar Factory, which has become Jagdeo’s best albatross around the neck of the Guyanese people.
“Mr. Fix It” brought in experts from everywhere, who had no clues as to why this new, modern factory was producing sugar at twice the cost of the colonial factory that was constructed more than 50 years ago.  Today, job security for sugar workers has been put at risk.
So as a result of this and many other half-baked projects, the debt repayment bill has gone up.  According to the Bank of Guyana, external debt service increased by 12.6% to G$5,250 million by June 2014.  Even domestic debt servicing with the local financial sector consumed some G$628 million for the same period.  The Bank of Guyana further projected that total domestic debt and external debt service is set to increase in the future.
When we ask about the status of our national debt and our international reserves, the regime gets hyper!
What have been lacking are schemes that could put more money into the pockets of the workers, better incentives that encourage entrepreneurs to make greater investments in their businesses.
As part of the Government-in-Waiting, the AFC intends to go all out to grow our people out of poverty. This would be achieved by putting industry on a firmer economic footing. The AFC will cut the Corporation Tax for the manufacturing sector, and for innovative ventures such a bio-technology, pharmaceutical and renewable energy.
WHAT THE AFC WILL DO FOR THE WORKERS
The AFC will:
ü    Provide a living wage
ü    Respect public service employees, and restrict contract employees
ü    Increase the income tax threshold to G$75,000 per month for workers by the end of its first term in office to ensure that working families and those depending on one income, can have more resources to take care of their highest priority – their families.
ü    Introduce a new Child Tax Credit for each child in a home, because we really care.
ü    Reduce VAT.
ü    Restructure and reform the GRA to make it more independent and empowered to claw back the billions lost to the tax dodgers.
ü    Appoint a Tax Reform Commission to explore additional options to put more money into the pockets of the hardworking families.
ü    Deliver a smaller government bureaucracy, cut waste on overseas travels for the bureaucrats, adjust super salaries for the “fat cats”, eliminate sinecure jobs for retired politicians.
OUR COMMITMENT
The AFC will:
ü    Work hard to reduce the economic divide between the rich and the poor.
ü    Combat corruption at all levels to ensure more moneys move from the under-ground economy to the formal economy.
ü    Review all contracts and arrangements that placed national assets and national resources into the hands of a few cronies, to enable their unjust enrichment at the expense of the masses of working poor and poor families.
ü    Incentivize all owners of wealth to pay their fair share of taxes and thus reducing the burden on the working poor. There would be amnesty for tax dodgers to come good. No more ferrying of moneys to multiple foreign bank accounts.
The AFC sees the upcoming May 11, 2015 elections as a choice between Issues and Ethnicity. If the right choice eludes us, Guyana would become worse, and the gap between the majority poor and the few rich would widen. Guyanese would then have to vote with their feet, but the doors are closing, as the Ramotar regime is bent on antagonizing traditional, friendly states which have been a safe haven for us.
For the AFC, we are optimistic: Better MUST come.

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