President of the Grenada Trades’ Union Council (GTUC), Madonna Harford wants government to ensure that all persons on the island are tax compliant as workers prepare to make additional financial commitments in the New Year.
The GTUC President made the charge in response to the national address delivered by Prime Minister and Minister for Finance, Dr. Keith Mitchell, in which he announced the first in a series of austerity measures to be embarked upon by his cash-strapped administration.
The nine-month old New National Party (NNP) government has announced plans to embark upon a home-grown programme of fiscal adjustment and structural reforms in order to deal with the island’s massive national debt of EC$2.3 billion.
In the address, Prime Minister Mitchell disclosed that the income tax threshold will be lowered from $5000.00 a month to persons earning $3000.00 a month and warned that property tax will be increased from the new year.
According to Dr. Mitchell, the home-grown programme, which will get the backing of the Washington-based International Monetary Fund (IMF), will be for a period of three years from 2014-16.
Following is Harford’s response to the address by PM Mitchell:
The shared sacrifice highlighted by Prime Minister and Minister of Finance Dr. the Rt. Hon. Keith Mitchell in his address to the nation is a matter the Grenada Trades’ Union Council (GTUC) recognises which inevitably would bring hardship on workers.
Workers earning in excess of $3,000.00 a month will be taxed 15% on excess income and those making in excess of $5,000.00 a month will pay 15% on income between $3,000.00 – $5,000.00 and 30% on all income above.
With the grave situation facing the country, the GTUC recognises the need for sacrifice at this time. GTUC also recognises Government in its initiative to restructure the gigantic national debt of 2.4 billion dollars, which works out at a cost of approximately $24,000.00 for each citizen of Grenada.
GTUC continues to be disturbed that a large section of non-wage earners including, self-employed, professionals and the informal commercial sector who clearly earn more than $60,000.00 avoid paying any income tax as it now appears on the Law Books by manipulating the system.
Had these tax evaders been paying their fair share of taxes, the Government may not have had to implement these stringent measures.
GTUC therefore calls on the Government to take all measures necessary to ensure tax compliance and make all and sundry pay their fair share.
In the face of these sacrifices partly brought on by maladministration of successive Governments, GTUC insists that it should have a place at the table when the multi-national agreements with IMF, World Bank and other financial institutions are being negotiated.
Further, GTUC calls for the establishment of a monitoring mechanism to ensure that loans and grants secured by Grenada are properly spent and managed and requests a presence on same.
We are somewhat confused by the direct reference made by the Prime Minister that unless the Public Workers accept the wage proposals made by the Government, the IMF and other potential financiers will not approve the US$100,000,000 which will be made available to Grenada.
Our affiliates have always been generous in their proposals for wage increases and it is noted that the last wage settlement accounted for 1.5% actual increases for each year of the agreement for the period 2008-2012.
GTUC calls on workers to understand the difficult times we are in and there is no easy way out of this crisis.