PNP Adjusts Funding Model for Promised Increase in Income Tax Threshold

The People’s National Party, PNP, has changed the proposed funding model for its promised increase of the income tax threshold to $3.5 million.

PNP Spokesman on Finance, Julian Robinson, now says the increase will be funded through adjusting the country’s primary surplus target.

The original plan was to fund the promise from what the PNP described as “organic growth”.

Chevon Campbell tells us more.

News coming from the country’s Independent Fiscal Commission is that based on the country’s adjustments in the System of National Accounts, Jamaica’s Debt to GDP has been revised downwards from 68 percent to 62 percent.

According to Fiscal Commissioner, Courtney Williams, this means the country could potentially reach its goal of 60 percent of GDP by the end of the current Fiscal Year.

According to Julian Robinson once the target is met, the country will no longer need to run the current primary surplus target of six percent of GDP.

This he says frees up much needed fiscal space.

Robinson says despite the intention to lower the surplus target, the PNP remains committed to fiscal responsibility.

Independent economists have suggested increasing the income tax threshold to $3.5 million would cost the country as much as $70 billion in revenue.

Just four days ago after Mark Golding announced the promise to increase the threshold, Mr. Robinson suggested the commitment would be funded through the natural growth in the economy and the $140 billion reaped in additional revenues over the next three financial years.

This promise also comes just months after Mr. Golding himself suggested a further increase in the threshold should not be a priority due to its limited impact.