Economist advises Bajan government to reduce taxes
One noted economist is warning the Mia Mottley administration to be careful not to compound the rising inflationary pressures by way of its policy stance.
In fact, economist Carlos Forte is proposing that Government urgently finds ways to provide an ease on taxes to help keep consumer prices stable and businesses open.
He stated that the call from the business community for an ease on import duties and review of other taxes was justified.
While acknowledging that rising prices were driven by external factors including supply chain disruption, geopolitical instability and oil prices, the Canadian-based Forte maintained that Barbados could still do things within its powers to help keep some prices stable.
“Government should not by way of policy compound those inflationary pressures, and in effect that is what it is doing by not adjusting its tax policy with respect to duties and freight charges.
The absence of doing so and for so long, compounds those inflationary pressures,” said Forte.
“Barbados has a high import duty regime and if something that costs $10 increase by $5 on account of this global inflation, when it gets to Barbados that increase is compounded further by the duty regime.
“So the call by economists and more recently the business community have some justification there.
“It isn’t just about do they want to be more competitive so they need a break. It is about Government policy by inaction that is making a bad situation worse when there are the policy tools to adjust and provide some ease of those inflationary pressures,” explained Forte.
In outlining several areas of concern recently, the Barbados Chamber of Commerce and Industry (BCCI) told Today’s BUSINESS that Government could help provide some relief over the short to medium-term.
“The cost of doing business has to be addressed as it relates to energy cost and the cost of imported items.
Economist: Adjust tax policy stance to ease prices Barbados Today