-Nagamootoo answers critics in fiery closing speech

AMID what has now become the customary walk-out by the opposition, Prime Minister Moses Nagamootoo on Friday defended his government’s $250B 2017 budget, describing it as ‘pro-Guyana’ and assuring that it demonstrated that the administration is capable of keeping its promise.
Nagamootoo also debunked criticisms by the People’s Progressive Party /Civic (PPP/C) and other groups, making it clear that the hysteria being raised by many over government’s proposal to implement a 14 per cent Value Added Tax (VAT) on water and electricity is a scare tactic.

Specifically rebutting the statements made by former Minister of Public Service and Member of Parliament (MP) Jennifer Westford, the Prime Minister said history will show that no charges were levied for untreated water. “Water was free,” he declared, noting that it was under the PPP/C in 2002, at the time headed by former President Bharrat Jagdeo, that water was metered and extended to rural areas.
Westford had questioned whether mothers will have to limit the water they use to clean their babies. APNU+AFC’s Minister within the Ministry of Communities Dawn Hastings-Williams had told the House during her budget 2017 presentation that there are 182,612 persons using water in the country, noting that 85,489 are metered customers while 97,123 are unmetered customers.

According to Hastings-Williams, 155,011 representing 85 per cent of the users pay $1500 or less for the water supplied by the Guyana Water Incorporated (GWI), while 27,601 or 15 per cent pay more than $1500. Those who must pay it could cost VAT of $1044 for consumption without limit. “Water charges are for urban residents, $100 per cubic metre or 220 gallons. To pay $1,500 one has to use 3,300 gallons which equals eight 400 gallon black tanks monthly.”
The Prime Minister said too that rates must be looked at against monies for the improvement in quality water. $2.8B has been allocated in the 2017 budget for the improvement of the quality of water provided to consumers. Turning his attention to criticisms over VAT being attached to electricity charges over $10,000 monthly, the Prime Minister said the case has been made that “ordinary consumers” will not pay VAT on electricity.

He said according to the Guyana Power and Light Incorporated (GPL) there are 165, 115 consumers of which 150,814 or 91.34 per cent are residents, while 14, 301 or 8.66 per cent are commercial consumers. It therefore means that 136,049 or 82.49 per cent pay electricity bills under $10,000, while 29,066 or 17.6 per cent pay over $10,000 for their service.
Nagamootoo asked, how could the reduction of VAT from 16 per cent to 14 per cent result in the “picking the pocket of the working people?”
The Prime Minister outlined, in the absence of the Opposition who left before the resumption of the National Assembly after the lunch break, that criticisms made by the PPPC on VAT are unfounded. He noted that “VAT is Jagdeo’s child,” stating that it was an International Monetary Fund (IMF) recipe which cost US$7.6B to be introduced.
He said too that over the years, there have been administrative bottlenecks with the refunding of VAT taxed to persons mainly on zero-rated items. “The state owes $7.6B,” said Nagamootoo.

Meanwhile, turning his attention to the criticisms by both the Opposition and the Private Sector Commission (PSC) on the garnishing of funds from persons’ bank accounts, the Prime Minister reminded the House that attention has to be paid to what the law says and give an interpretation in keeping with what has been stated in the legislation.
Nagamootoo chided the Opposition Leader for stating that government is committing an unlawful act and operating in contravention of the constitution. However, he pointed out that all that the Minister of Finance is attempting to do is bring the VAT Act in consonance with the Income Tax Act.

The Finance Minister in his budget presentation said, “It is proposed to revise the provision of Section 45 of the VAT Act by deleting the provision which allows for a court order to be obtained to enforce this provision. This will be consistent with a similar provision which exists under Section 71 of the Income Tax Act Chapter 81:01.”
Section 71 (1) of the Income Tax Act says, “Where the Commissioner- General is of the opinion that any person is about to or is likely to leave Guyana without making arrangements to the satisfaction of the Commissioner- General when required by the Commissioner- General to do so, for the payment of all income tax that is or may become payable …up to and including the year in which he proposes to leave Guyana, the Commissioner- General may issue a direction to the Commissioner of Police or Chief Immigration Officer, or both, to prevent such person from leaving without paying the taxes or furnishing security to the satisfaction of the CG for the payment thereof.”

Promises
Meanwhile, the Prime Minister made it clear that the 2017 budget is not centred on VAT, but on fulfilling the coalition government’s 2015 manifesto promises to citizens.“ “The budget is not about VAT. It is about fulfilling [a] manifesto promise to lay [the] basis for orderly, law-governed, clean and green society.”
As such, Prime Minister Nagamootoo highlighted the achievement of several promises made by the APNU+AFC while on the campaign trail . “By reducing vat from 16 to 14per cent, we kept our promise; by raising the threshold for a person to be a vat registrant from plus $10 m to 15 m, we kept our promise not to go after small traders; we also realised other 100 day promises; we reduced the Berbice river toll; we held local government elections; we establish Public Procurement Commission; we reduced income tax; we raised the minimum wage; we increased wages, pensions and social assistance; we provided training, instead of dole, to Amerindian youth; we restored the garbage city to the status of a garden city, and implemented strict order; we put an end to floods every time the rains threatened,” he stated much to the approval of his colleagues on the governing side of the House.