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The Government has taken aim at businesses, especially in the retail trade, which it claims are using pieces of paper as customer receipts in order to avoid the general consumption tax (GCT).

Finance Minister Audley Shaw, who made the charge, said the emerging practice where super-markets, haberdasheries and other companies enter into “straight cash” transactions with customers is one of the reasons the GCT revenue is underperforming.

“Receipts are being written on a little piece of paper. No GCT, that sort of thing. It has to stop, it has to stop,” Shaw warned during his recent post-Budget press conference at the Ministry of Finance’s Heroes Circle offices.

“Whoever you are, and wherever you are evading the GCT system, we are coming to you and we are serious,” he emphasised, adding that incidents of GCT evasion are on the rise.

The finance minister, however, declined to elaborate, saying he was not ready to divulge details of his plan to curb the practice.

Noting that the primary surplus target is off by close to $4 billion, Shaw said the Government is now doing a proper analysis of the reasons for the fallout in revenues, saying it is equally important for the International Monetary Fund and the Government to know.

“If the evasion of GCT has taken on a new momentum of its own and that is one of the reasons (for the fall-out in revenues), I am going to stop it,” he said.

Shaw also disclosed that the Government is creating a database of all self-employed professionals as it prepares to widen the crackdown on those who have been avoiding the tax net.

One-year warning

Pointing to a recent survey which showed that only 20 per cent of 500 doctors polled were actually filing tax returns, the finance minister said professionals, such as lawyers and doctors, should consider the decision to compile the database as a one-year warning.

Come March 15 next year, he said, the tax department will check the database to see who did not file their returns.

“If you have not filed your returns, just like the Internal Revenue Service of the United States, you are going to get a little love letter that says: ‘We notice that the March 15 deadline has come and pass and you have not sent in your returns. May we have your returns?’,” he explained.

Shaw said these individuals are earning “pretty healthy” salaries and are not declaring their income, something he described as inappropriate and unacceptable.

Source: Jamaica Gleaner