When the joke is on us

ECONOMICSTDAY-1It has been six months since I’ve written in this space and certainly much has happened over that period of time.  I sincerely apologise for what must have seemed an abrupt end to our interactions which I enjoy very much.  So let me extend quite belated greetings for Independence, Christmas and, of course, a Happy New Year to you all.

Let me declare, confess, disclose, reinforce, divulge, make known, come clean, affirm that I am still an economist and that my previous communications with you, the Barbados TODAY reading audience, was in no way predicated on my subsequent entry to elective politics. Even before I considered and decided to run as a candidate, some people already thought my public utterances were politically motivated rather than on seeking to resolve the current problems that confront us. Be that as it may, I am now fully cognisant that anything I say or do will be unfortunately analyzed with a very strong political filter.

I do hope, however, that you continue to dialogue with me and I certainly welcome any feedback you may wish to share as we seek to grapple with and make sense of what must be the longest period of economic stagnation and mismanagement in our nation’s history.

For the avoidance of doubt, I wish to make it crystal clear to all, that I do not hold any personal grudge towards any member or supporter of the current administration. So I would like that when the political filter is attached, that at least it is applied from a professional or philosophical point of view rather a personal one.

By now, you might have surmised I have a fixation with one’s ability to plan whether as an individual, household or business. It is the bedrock on which all modern economies operate. Some commentators refer to this as confidence but, in my mind, the two, though inextricably linked, are separate and distinct even if at times there are no clear lines of demarcation.

Confidence relates the level of optimism and pessimism one feels about future prospects, either as an individual, household or business, given prevailing market conditions. The ability to plan relates more to the provision of relative certainty over a period particularly when it comes to public policy. It is hard enough having to compete with other individuals and businesses in the marketplace, but add the lack of clarity of public policy to the mix, and what you get is a recipe for economic chaos.

Over the past six months, many persons have asked for me to keep on writing in an effort to help educate the populace on economic matters. I have also been asked to communicate in such a manner that the “average” Joan and John Public can understand. Whilst I willingly accept the challenge, and am always prepared to engage on issues of concern, there always comes a point where the political affiliation of Joan and John kicks in like a self defence mechanism rendering any further meaningful discourse difficult.

Having said that, I fully accept that it is very difficult to change mindsets overnight and that repetition is warranted until it becomes second nature to both Joan and John. Inasmuch as I am willing to achieve relative success in this endeavour requires that both Joan and John pay attention and see the need to become and stay engaged. Too often, Joan and John sit up and pay attention only when their circumstances are impacted both directly and negatively.

By the time this article is published, All Fools’ Day would be upon us. Rather than the practical jokes we played as primary school students making us laugh and reminisce, Joan and John must asking themselves the extent to which the parliamentary group of the Democratic Labour Party thinks we are ‘All Fools in April’.  The following are some examples of the tomfoolery currently at play.

Consolidation Tax on persons whose gross income exceeds $50,000 was to expire on March 31, 2015. In December 2014, the 19-month programme was working so well that this measure and others were extended for another financial year, or until April 2016 which means all like now. Close examination of the Estimates of Revenue and Expenditure for 2016-2017 shows an allocation of $30,159,718 for this taxation. I don’t recall any specific announcement that this tax will continue, but the evidence is there for all to see.  Fool me once.

The reader will recall that the Solid Waste Tax was introduced supposedly to pay SBRC for waste management. At the time of its abolition, SBRC was yet to receive the collected funds which taxpayers dutifully lined up to pay, yet no refunds were issued and no explanation provided as to what the monies were spent on. Fool me twice.

Having abolished the Solid Waste Tax, the Minister of Finance has shifted that burden onto land tax by increasing the rates. At some point during the first quarter of 2016, you might have been visited by valuers from BRA, which I can only assume would mean an increase in property valuation. The prospect of a lower threshold, increased rates and increased valuation is real, placing additional burden on those of us earning above $50,000. Fool me thrice.

Refunds for income tax year 2013 were paid in 2015 and assurances were given in the House of Assembly that the said refunds included interest. We were also assured that refunds for 2014 would be paid by March 2016.  I haven’t met anyone that received interest with their 2013 refunds and the few persons that have received 2014 refunds, indicated that interest hasn’t been paid. Fool me again.

By its own admission, the DLP-administered Government is cash strapped. One might even be sympathetic and not fuss about getting the interest owed to you on income tax. However, when one hears advertisements on the radio urging people to pay land taxes so as not to incur penalties and interest, then you know someone thinks that We Are All Fools.

(Ryan Straughn is an UWI Cave Hill and Central Bank of Barbados trained economist and shall remain so for as long as possible. He is also a BLP candidate for Christ Church East Central Email: straughn.ryan@gmail.com)

One Response to When the joke is on us

  1. Leon Douglas
    Leon Douglas April 2, 2016 at 11:32 am

    Blame Rihanna.


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