Budget ignores many core issues raised in consultations
-Georgetown Chamber
Stabroek News
April 14, 2004
The Georgetown Chamber of Commerce and Industry says this year's budget has not, for the most part, addressed many of the core issues it had raised in consultations with government.
"Consequently, the perception is triggered that the consultations between government and the various private sector bodies are mere formalities," the Chamber said in a press release yesterday on the March 29 budget.
The Chamber noted that for a number of years it had been urging that the income tax threshold be moved from $20,000 to $36,000 and that corporate taxes be lowered from 45% to the amount that the manufacturing sector is granted. It says that it has also argued that the business community and current taxpayers are overtaxed and that those evading the tax net - traders, hucksters, tradesmen, minibus operators etc should be brought into it. It further said that the situation with the Customs and Trade Administration does not augur well for investment and trade expansion. "In these times of free trade, it is imperative that government is a facilitator, which creates an enabling business environment. Customs is a key government department. If importers face difficulties, then these problems will filter down to the final consumer", the Chamber said.
The stagnation of the income tax threshold restricts consumer spending power and therefore limits the ability of Guyanese to offset the spiralling cost of living, the Chamber contended.
Additionally, there has been an increase in most commodity prices in Guyana, and that is expected to escalate in coming months, especially in building materials. This again suppresses consumer spending power and puts an extra burden on Guyanese, the Chamber said.
The body says also it strongly feels that in the government's Poverty Reduction Strategy there should be more emphasis on creating jobs within sectors poised for takeoff. The agriculture, industry, trade, housing and water and tourism sectors are but a few of those with the capability of propelling Guyana's economic growth, the Chamber posited. Moreover, it noted, with the bridging of the Berbice River and the Guyana/Brazil super highway, government has to make the necessary budgetary implementations to prepare the country to become a major trans-shipment point into Europe and Latin America, as well as the creation of more "Economic Zones".
While government should be congratulated for having such improvements as better roads, bridges and schools, the Chamber would like to see increases in reasonable returns within all the sectors and a rise in the standard of living of every Guyanese.
Unfortunately, the Chamber argued, the reverse seems to be the case. "Many businesses are facing imminent closure, while others are downsizing.
In the past our economy was plagued with political disturbances, now we are plagued with an uncontrollable crime situation," the Chamber observed.
According to the Chamber, these negative events have resulted in losses totalling billions of dollars and possible endangerment to local and foreign direct investment (FDI).
Noting that FDI plays a major role in the economic development of a country, the Chamber remarked that Guyana cannot afford to miss such opportunities. The Chamber was therefore pleased to see the budget assisting the Guyana Police Force to combat crime and that it would be getting necessary legislative, financial and technical support, the release observed.
The Chamber said it was also concerned that the budget was presented just before the constitutional deadline, and it lacked what it referred to as "adequate substance" to bring urgent relief to employees, businesses and investment.
The body pointed out that the migration of qualified and experienced personnel continues to be a critical blow to the country, while the Guyanese community is increasingly dependent on remittances from abroad.
There is a lack of growth in the economy, the Chamber asserted, and a growth rate of 5-7% is needed to make a more meaningful impact on poverty levels. Moreover, the Chamber said, it is difficult for the economy to thrive in an environment of bad relations between government and the opposition.
The presentation of a National Budget may have been a task concluded, but the major task ahead is to have proper implementation of the budget as that is extremely critical for the progress of Guyana, the Chamber added.