‘Strengthening Tax Reform Initiatives’: Joe Issa Marks TAJ, ICAJ MoU Good for Jamaica

Certified Public Accountant (CPA) Joe Issa has come out in support of a memorandum of understanding (MoU) recently signed between the Tax Administration of Jamaica (TAJ) and the Institute of Chartered Accountants of Jamaica (ICAJ), stating it creates an appropriate forum for tax reform in Jamaica.

Josy
Joseph “Joey” Issa

“Talk reform and you are on the right track. The operative word is to reform; that means doing the right things better for yourself and those who are impacted. In other words, the more you do the right things, and the better you do them, the more benefits that will accrue to those who are impacted by what you do.

“But for that to happen things have to change both in what we do and how we do it, to create greater effectiveness and efficiency, respectively. They are equally important; for it’s no point doing the right thing only to find out you are not doing it right; or, even when you think you are doing the thing right, it turns out you are doing the wrong thing.

It’s like doing what the people want but not how they want you to do it. This has broad application, including how we do business. Such as importing and exporting and investing and creating jobs,” said Issa, who has not only spoken of the need for local corporations to pay tax but thinks that instituting a rate that is above what obtains in Jamaica’s trading partners is putting domestic firms at a disadvantage relative to their foreign counterparts.

He explains further: “The TAJ is doing the right thing by ensuring tax compliance, but like most similar cases they need guidance and assurance that they are going about it the right way; that’s where I see value in the MoU.

Issa was commenting on a recent MoU signed between TAJ and ICAJ to strengthen longstanding collaboration on matters related to the country’s tax system.

“The concept, which has been adapted from the Canadian Revenue Authority’s model, underpins the establishment of a Consultative Committee that will provide a forum for dialogue between senior officials and members of the TAJ and ICAJ on a wide range of issues,” according to the Observer.

(L to R) Peart, Campbell, Powell, Sinclair
(L to R) Peart, Campbell, Powell, Sinclair

These reportedly include the sharing of information on existing and proposed compliance programs to identify improvements; the identification of opportunities for collaboration with taxpayers; and revisions to protocols facilitating taxpayers, based on legislative amendments, among other things.

The committee is to be co-chaired by TAJ Technical Specialist, Bevon Sinclair, and Head of the ICAJ’s Tax Committee, Allison Peart. They were among the four representatives who co-signed the MoU at the Jamaica Pegasus Hotel in New Kingston recently.

The signing also included TAJ Commissioner General, Ainsley Powell and ICAJ President, Raymond Campbell and was witnessed by Finance and Public Service State Minister, Fayval Williams. The signing occurred during the TAJ’s ‘Let’s Talk Tax’ forum, which was held under the theme: ‘Tax Compliance in Jamaica’.

Powell was quoted say the MoU provided “an excellent opportunity to strengthen the TAJ’s strategic relationship with the accounting fraternity in ongoing efforts to further improve the administrative procedures and processes driving Jamaica’s tax system.”

He also anticipated that “both organisations collaborating to identify the necessary changes that result in improvements in the overall system will redound to the benefit of taxpayers thereby engendering greater voluntary compliance,” according to the newspaper.

2016 to Provide Momentum for Growth in 2017 – Joe Issa

St. Ann’s Chamber of Commerce Past President Advisory Committee member Joe Issa has tipped the economic growth momentum experienced in 2016 to continue into 2017.

Joey 6

“This year I expect higher growth in the economy than what we experienced last year when some of the policy measures implemented earlier in the year showed good results towards the end.

“2016 finished on a high note which will reverberate throughout this year to provide the momentum needed for improved performance…it’s what can be called the piggy-back effect…success feeding on success to achieve even greater success,” Issa posits in an interview on the outlook for Jamaica in 2017.

Noting he had seen the latest growth figures Issa says, “I am encouraged by the stats and more so when disaggregated as all sectors seemed to have pulled their weight…it all adds up and tells a story of increased output, consumer confidence and employment…the prime minister has been personally pushing the BPO sector so we may well be seeing the impact in the numbers.”

According to tradingeconomics.com Domestic Product (GDP) figures show that the economy of Jamaica had grown 2 percent year-on-year in the third quarter of 2016, the highest since the second quarter of 2014. The outturn for the September 2016 quarter was also higher than the 1.4 percent recorded in the second quarter.

The 2016 third quarter statistics also show that both goods and services played a part, which analysts say is the best structure within which to grow the economy.

Agriculture, forestry and fishing which has benefitted from a renewed focus on import substitution and greater linkages with the tourism sector improved from a growth rate of 9.4 percent in the second quarter to 29.1 percent in the third quarter.

Mining and quarrying also responded with the growth of 2 percent in the third quarter from -1.9 percent in the second, while manufacturing was up 0.1 percent from 0.6 percent in the second quarter.

Increases were also said to have been recorded for electricity and water supply which grew by 2.5 percent in the third quarter compared with 5 percent in the second quarter.

Hotels and restaurants grew from 1.3 percent in the second quarter to 2.2 percent in the third. Transport recorded growth of 0.5 percent compared with 0.7 percent in second quarter.

Further comparison shows that the GDP outturn in the September 2016 quarter was much higher than the 0.14 percent average recorded from 2003 to 2016. A record high of 2.2 percent was recorded in the fourth quarter of 2003, and a record low of -2.10 percent was posted in the third quarter of 2014.

Dr Wayne Henry 1
Dr Wayne Henry

Dr Wayne Henry, director general of the Planning Institute of Jamaica (PIOJ), agrees with Issa, not only on the strength of the growth experienced in the third quarter of 2016 but also what it means for the country.

Stating that the pace of growth represented the most reliable estimate since April-June 2007, Dr Henry said at a PIOJ quarterly press briefing that “overall, the projected out-turn largely reflects the positive impact of higher levels of business and consumer confidence and increased employment levels with supported increased demand.”

“This was also reflected in increased construction activities with the building of new, and refurbishment of existing hotel rooms, the build out of office space to facilitate the expansion of the business process outsourcing industry, and road rehabilitation and expansion work,” the Gleaner quoted Dr Henry as saying.