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Three Prunes from the PUP Manifesto Print E-mail
( 2 Votes )
Written by Administrator   
Thursday, 01 March 2012 00:00

Contributed

After four years of waiting, I feel cheated and disappointed. I have just gone over the PUP Manifesto and all they are offering are three things. The rest is polished rhetoric. This manifesto can be considered TIMID, which for the PUP means that they have run out of ideas. Let’s examine the offerings:

All real agricultural inputs will pay 0% import duties.

The effect of the above is reduced revenue to government of Belize. This initiative more than likely will not translate into lower agricultural prices since Government cannot force farmers to lower prices. What may very well happen is, because of lower production cost, farmers will look forward to even higher margins from contraband trade in rice, sugar, and corn to Guatemala and Mexico. One thing is almost certain are that a zero rated import duty on agricultural imports will definitely not translate to lower food basket prices.


Threshold on personal income tax will be raised to $36,000 This is probably the best icing that will appeal to the average person. This however ,did not require much imagination. The downside to this is again a subtraction from Government revenue. That aside, it is enticing.

Reduce the GST back to 10% This will only appeal to the merchants, who are already not fully reporting GST collections. Historically, in Belize, once shelf prices go up, they never come back down. Therefore, effectively, merchants will hoard the reduction in increased mark up. Consumers get the BUKUT again and Government loses more revenue.

That, in a nutshell, is all the offerings. On the contrary, the PUP proposes to increase the wage bill by increasing minimum wages. There goes the vision, as production costs or service costs just went up translating into higher prices of goods and services. What we have here is increasing consumer prices along with reduced GOB revenue collection.

So careful or TIMID is this manifesto that the only capital-intensive proposals they have comes with no details. Check the below:

•The PUP will re-activate a booming construction industry by offering attractive fiscal incentives to the private sector for the building of industrial facilities, housing projects with mortgage financing and tourism projects including world class hotels with international conference facilities and for the building of a port for cruise ships to dock alongside.

That is it, no details to suggest the magnitude, volume of investment and most of all how many jobs will be created. Something any proud and ambitious Government in waiting would have loved to flaunt. The lack of details become very suspect as can safely infer Government guarantee to some failed PUP crony. Another super-bond in the waiting. Note also, the offer of ATTRACTIVE FISCAL INCENTIVES, which will translate in more loss of revenue. All this seems to fly in the face of what the IMF was recommending.

GOD save our souls, PUP no even win yet and we already facing a deficit from all these give away. Dejavu, “WELCOME TO THE PARTY.”