Call for reform in tax structure To the Editor
Guyana Chronicle
December 21, 2001

IN APRIL of this year, the National Association of Agricultural, Commercial and Industrial Employees (NAACIE) and the Guyana Agricultural and General Workers' Union (GAWU), had submitted to you, proposals for a reform of the current Income Tax structure, in the National Budget, 2001. We subsequently had discussions with you on this matter, prior to the submission of the Budget.

We were therefore terribly disappointed when the 2001 Budget was finally presented and no consideration was given even to a partial reform of the current oppressive Income Tax Structure. You should be reminded that in 1993, when salary in the Public Sector was $4,314 per month, the non-taxable threshold was $10,000, when the salary moved to $6,380 per month, the threshold was increased to $12,000 and in 1996, when salaries in the Public Sector was increased to $8,805 per moth, the threshold was further increased to $15,000. At all times the non-taxable threshold was almost double the minimum salary in the Public Sector.

Since 1997, the non-taxable threshold has been held constant at $18,000, while the salary in the Public Sector has increased to $19,000 per month. To continue to have the non-taxable threshold below the level of the minimum salary in the Public Sector and for workers to pay as much as 33 1/3 per cent of their earnings in tax, is an unreasonable and unacceptable situation. It offers no incentive to motivate the ordinary working class people who are struggling to earn a decent standard of living and are the major contributor to this oppressive tax regime.

It is against the foregoing background that our Unions, NAACIE, GAWU, CCWU and GLU are submitting to you, for your serious consideration, the following proposals for a reform of the Income Tax Structure.

a. That the non-taxable threshold be increased to $38,000 per month;

b. That allowances be re-introduced to provide for children under 18 years and Dependents;

c. That the payment of mortgage/loan and student fees, be exempted from Income Tax.

Finally, we had written you on July 18, 2001, regarding information we had received from employers in the Private Sector, that they were instructed by Officials of the Guyana Revenue Authority to deduct taxes from meal and vacation allowances, paid to employees. In our letter, we had pointed out that currently in the Public Sector meal and vacation allowances were not taxable. In a subsequent meeting with you, you had promised to look into this matter and forward us a response. Unfortunately, until now we have not received any response from you, despite several reminders.

We therefore look forward to your urgent consideration of these matters and to hear from you soon.
General Secretaries of NAACIE, GAWU, CCWU, GLU