Dear Editor,
A summarized political biography on former British Prime Minister Margaret Thatcher in the online Literary Encyclopedia includes the paragraph: “Wishing to balance the budget, Thatcher introduced lower taxation and a reduction in public expenditure. Upon entering office, she immediately lowered the income tax rate-a tax cut that she offset by increasing the Value Added Tax (VAT) on the sales of goods and services. This change was significant for two reasons: it constituted a shift from direct to indirect taxation, and it was a tax break skewered in favour of the rich, who found that the rate of tax for higher income levels was disproportionately reduced in comparison to those in the middle income tax rate band”. Guyana VAT is designed to accomplish the same shift in tax obligations, at least in my unqualified view. Being light on the rich who are mainly sellers of goods and services and can pass it down, and heavy on end consumers where the buck will inevitably stop.
I rather suspect that this letter will elicit angry expert financial and economic responses from many. And since they all, no doubt, might have establishment accredited expertise in the subject matter in contrast to this writer, I expect to be visited with a deluge of complex explanations relating to economics and taxation. The problem with these policies in nations structured like ours is that those upon whose shoulders the ultimate burden rests, are least likely to be in a position to bear it. Because for me Vat is nothing more than a cop out, an effort to make up revenue from those at the bottom rather than mustering the courage to enforce tax collection from those at the top.
About the only people who cannot evade paying taxes in Guyana are those in the public service who also happen to number among the lowest salaried workers in the society. They also happen to be the ones whose views are least taken into account when decisions are being taken on policies like VAT. I am sure that the Government met and consulted with businesses as it went about structuring this tax on the poor, and never spared a thought of the irony in not consulting those from whose measly salary much is taken out to finance the machinery of Government. But then again, we are talking about a society so stratified on the basis of wealth and class that the views of parcels of the bottom do not factor into the decision making equation.
Yours faithfully,
Robin Williams
