– ahead of Wednesday presentation
- $5B bailout for GuySuCo
- $800M for Amerindian Development Fund
- 2-weeks tax-free bonus for joint services, $150M for front line worker
- $150M for front line worker
President Irfaan Ali on Monday announced a number of tax relief measures including the removal of Value Added Tax (VAT) on electricity, water and interior air travel, in addition to a $5B bail out for the cash-strapped Guyana Sugar Corporation (GuySuCo), $800M for the Amerindian Development Fund, $150M for frontline workers and a 2-weeks tax-free bonus for the joint services.
President Ali made the announcement during a press conference at the Arthur Chung Conference Centre (ACCC) ahead of the presentation of the National Emergency Budget to the National Assembly on Wednesday.
In making his announcement, the President stated that the reversal of VAT on electricity and water will bring down the cost of manufacturing, while simultaneously benefiting all other sectors of the economy. VAT and duties on equipment will also be removed much to the benefit of those operating in the Gold and Diamond Mining Industry, Forestry and Manufacturing Sectors.
“In addition to this, because of representation from the sector, we have decided on the granting of tax concessions on ATVs for mining, forestry, agriculture and manufacturing,” President Ali disclosed. In the Agricultural Sector, there will be a removal of VAT on fertilizers, agro-chemicals, pesticides and key inputs the poultry sector. Additionally, there will be a reversal of VAT on all exports, hinterland travel, cellphones, building and construction materials and all medical supplies. The latter, the President noted, will aid in the current fight against the deadly Coronavirus Disease (COVID-19). Further, Corporate Taxes on private education and private healthcare will also be removed in an attempt to make these private services more affordable.
AIDING THE AILING SUGAR INDUSTRY
The tax relief measures aside, President Ali announced that the Emergency Budget will also include a $5B subvention for GuySuco, which for decades have been struggling to stay afloat. Shortly after taking Office in August, the PPP/C Administration announced that some $600M would be injected into the Sugar Industry. In an attempt to make the industry more viable, the A Partnership for National Unity + Alliance For Change (APNU+AFC) Administration had “right-sized” it by reducing its operations to three Sugar Estates during its five-years reign in Office but the PPP/C has since vowed to reopen them, in keeping with its campaign promise.
Grants, Funds and Pension
Cash grants, the president announced, will also be introduced for school-aged children with effect from January 1, 2020. Under the PPP/C Administration pre-2015, the cash grant stood at $10,000; this time around it will be increased to $15,000 while the uniform voucher allowance will be doubled to $4000 per child. Also in the field of Education, $200M is being budgeted for the Learning Channel so as enhance e-learning in the country.
Additionally, the Joint Services will be receiving a 2-weeks tax bonus while some $150M will be set aside for the country’s frontline workers in light of the COVID-19 pandemic. Each household, the President said, will also receive a $25,000 to cushion the impact of the pandemic on people’s ability to work and earn a living.
“Effective 1st January, 2020, the pension for old age pensioners will be 25,000 per month,” President Ali further announced while adding that they will also be receiving free water. When the PPP/C Administration demitted Office in 2015, pensioners in Guyana were receiving $7,500 per month, however this sum was insignificantly increased by the APNU+AFC Administration by close to 200%. As of now, pensioners take home $20,500 a month.
The Amerindian Development Fund is also expected to receive $800M. This, the president said, will help to foster development and create job opportunities within the Hinterland through the Community Support Officers (CSOs) Programme. Also, 25,000 solar panel units will also be purchased for the Hinterland.
According to the President, these measures and policies will further stimulate economic activities while simultaneously reducing the cost of doing business and improving the lives of Guyanese. “These measures no doubt will have an immense impact on people’s welfare and wellbeing. A number of the measures will address, directly, issues of cost of living and living standards,” he told journalists at the ACCC in the presence of Vice President, Bharrat Jagdeo.
He noted that since taking office, the People’s Progressive Party/Civic (PPP/C) has been able to do a rapid assessment of the country and its economy, and it is based on that assessment that the measures would be implemented.
Vice President, Bharrat Jagdeo who was also at the news conference told reporters that the measures and policies announced by the President are in keeping with promises made by the PPP/C on the campaign trail.
“Although these are emergency measures, we have substantively addressed most of the tax measures we promised to deal with in the new Government… Many of the measures that the president announced are an early fulfilment of those promises that were made to the people of this country,” Jagdeo said. He noted that the underlying philosophy of the budget will not depart radically from the PPP/C’s manifesto.
The National Emergency Budget will be presented on Wednesday by Jagdeo.
