Businessuite Weekly
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Contents Cover Story
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LIME Banking On Profits To FLOW Cable and Wireless Jamaica (C&WJ), to many, is a company known for its large scale recurring losses and its inability to fully satisfy the needs and desires of the Jamaican people. This year is no different as the company’s audited financial accounts shows...
EDITORIAL
FINANCING
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Jamaica, despite its achievement in introducing comprehensive laws to protect women and its move to advance gender equality, has a long way...
MSMEs urged to utilize benefits of DBJ and NCB loans As concerns about the availability of and Access to financing being available to Micro, Small and Medium sized Enterprises (MSMEs), they are...
Technology
Company Reports
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Apple Launches newest Product suite Apple has launched its new suite of products with most expected to be on sale by this Wednesday, September 16. Included in its suite of products...
Businessuite Weekly
Sagicor Real Estate X Fund assumes ownership of Double Tree by Hilton Hotel in Orlando, Florida, USA Brand Jamaica will be furthered following Sagicor Real Estate X Fund’s (X Fund) acquisition of the Double Tree by Hilton Hotel in Orlando, Florida.
Contents The Week Ahead
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Credits
Businessuite Event Calendar
Content Director Kayla Wright
The Businessuite News Centre BNC
Regional
Publisher and Editor in Chief
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Dominican Republic and Haitian Chambers of Commerce sign cooperation agreement to strengthen business communities
Subscription and Distribution
The Federation of Chambers of Commerce of the Dominican Republic (FEDOCAMARAS) and the Chamber of Commerce and Industry of Haiti...
Graphic Design and Layout:
Aldo Antonio aldo@blackslateholdings.com
Advertising Sales
businessuitemagazine@gmail.com
Bonito Thompson
Photo credits
Sourced from the internet and contributed
Agreement signed to promote economic, social and agricultural development in Latin America and the Caribbean
Social Media
CLICK Digital Agency
Businessuiteonline
Under a new cooperation agreement signed by the Mexican Agency for International Development Cooperation (AMEXCID) and the Inter-American ...
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Honduras records Mid-year economic growth of 3.6 as IMF concludes first reviews of Stand by Arrangement and Agreement
PUBLISHERS:
The Honduran Central Bank says the economy grew by 3.6% more than the same 6 month period last year. According to the Monthly...
Commentary
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Mark s Laas Lick: Why T-A-X-E-S is a most hated word in Jamaica “GCT or no GCT?” asked the Chinese owner of the shop in the heart of ‘China Town’ in an area of down town Kingston where the numerous...
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Blackslate Media Group Ltd, “Silicon Mountain” Mandeville Jamaica 876-631-5418 (Kingston Office) 876-458-3253 (Mobile) 876-631-4505 (Mandeville Office) 876-280-9192 (Mobile) To learn more about Blackslate go to www.blackslateholdings.blogspot.com aldo@blackslateholdings.com
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Editorial By Kayla Wright
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amaica, despite its achievement in introducing comprehensive laws to protect women and its move to advance gender equality, has a long way to go.
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Earlier this week, I had the pleasure of sitting in on the Annual General Meeting for Cable and Wireless Jamaica, more popularly known as LIME and in recent weeks, FLOW, during which, one stakeholder expressed her discomfort at the small number of female managers and directors on the board and in senior management. As the current board of LIME stands, there are two female board members out of six. This includes, Senior Executive Director of HEART/NTA, Dr Carolyn Hayle and attorney at Law, Rochelle Cameron. Meanwhile, the Senior Management team, made up of approximately 13 persons, includes, once again, only two females (Rochelle Cameron as Head of Legal and Regulatory, and Phadra Saunders, head of Human Resources).
Speaking at the AGM, the shareholder expressed how disappointed she was that the board and senior management team were so dominated by males. And in response, she was told that during the recruitment process, the best persons for the positions were chosen. Which begs the question….are the nations and by extent, region’s women not qualified for these senior management positions? And if they are qualified, why then are they not considered the ‘best person for the job’? According to the World Economic Forums 2014 Gender Gap report, Jamaica is ranked 52 out of 142 countries with wage equality between women and men returning a ratio of 0.713 for female-over-male for similar work. This is despite a female to male ratio of 2.05 in relation to enrollment in tertiary education and a 1.12 female to male ratio of literacy. So the question must once again be asked. If women in Jamaica and the wider Caribbean are qualified for the top positions in companies, why is it that only 24% of firms across the island have females as top managers? Why is it that only 38% of firms across the island record female participation in ownership? And why is it that on a scale of 1 to 7 (with 1 = worst score, 7 = best score), a general survey shows that women only have a 4.6 ability to rise to positions of enterprise leadership? Yes Jamaica like the rest of the Caribbean is doing well, but more can be done. While what the country is doing right to advance gender equality is commendable, focus needs to now be placed on what the country is doing wrong and how it can turn this around. BM
According to the World Economic Forums 2014 Gender Gap report, Jamaica is ranked 52 out of 142 countries with wage equality between women and men returning a ratio of 0.713 for female-over-male for similar work. 6
Businessuite Weekly
Technology Apple Launches newest Product suite e Amazing Consumers can also look forward to a completely new product which Apple has named: The Apple Pencil for drawing.
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pple has launched its new suite of products with most expected to be on sale by this Wednesday, September 16. Included in its suite of products are the newly designed Apple Watch, the new and improved iPad Pro, the iPad mini, Apple TV and the long awaited iPhone 6s and 6s Plus. Consumers can also look forward to a completely new product which Apple has named: The Apple Pencil for drawing.
iPad Pro The new iPad Pro brings a slightly larger screen at 12.9 inches to accommodate gaming, entertainment, a full-size software keyboard and a multi-tasking tool. iPad Pro is packing 2732 x 2048 pixels, making 5.6 million pixels in total. It runs on the new A9x 64-bit chip that is 1.8 times faster than the previous generation, with a display that features variable refresh rate. Apple says iPad Pro boasts roughly 10 hours of battery life per charge, measures 6.9 mm thin, weighs roughly 1.5 pounds and has a 8MP camera.
Apple Watch The new Apple Watch collection which will be
available in October comes with a few new
finishes, including gold and rose gold, and band colors for the fall. The device sells for the same price, starting at $349. Meanwhile, Apple WatchOS2 will be available September 16. It will include third-party integrations such as AirStrip and messaging apps like Facebook Messenger.
The iPad Pro also comes with a stylus to go along with the device called the Apple Pencil, which charges via a Lightning port. You can use the stylus to mark up emails, images and
{ Coming Soon The new Apple Watch collection which will be available in October comes with a few new finishes,
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E unbelievable The remote lasts approximately three months per charge and has a gyroscope for gaming.
others directly via select iOS apps.
iPhone 6s and 6s Plus
Alongside the iPad Pro announcement, Apple also quietly sneaked in $399 iPad mini 4, an updated version of its tiny tablet.
Apple also unveiled its iPhone 6s and iPhone 6s Plus. The more durable iPhone integrates a new 3D Touch technology which enables new gestures, such as holding an app icon for shortcut to various actions or using a hard press to preview links.
Apple TV As previously rumored, the new Apple TV will include a Siri voice control feature and a touch-capable remote that doubles as a gaming controller. You can ask Siri to find content based on categories, titles and she can sort results by popularity and where content is available to stream. You can access Apple Photo and Music on the streaming device. The Bluetooth 4.0 remote also allows you to swipe quickly to scroll past results, or slowly to hover over a title card to learn more. The swiping feature also works as fast-forward during playback, or you can ask Siri to skip ahead or rewind.
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The iPhone 6s and 6s Plus come with the new A9 chip – 70 percent faster at CPU tasks and 90 percent faster for graphic tasks than the previous model. iOS 9 will come standard with News and Apple Music app. Current iPhone users can download iOS 9 on Wednesday, September 16. There’s also a new “Hey Siri” integration that lets you speak the prompt to bring up Siri instead of holding the home button. The camera now has a 12MP iSight shooter – with 50 percent more pixels and faster auto-focus. It can shoot 4K videos as well. BM
The remote lasts approximately three months per charge and has a gyroscope for gaming.
O It’s Faster The iPhone 6s and 6s Plus come with the new A9 chip – 70 percent faster at CPU tasks and 90 percent faster for graphic tasks
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The peeking feature is similar to Moto Display on select smartphones which lets you tap to see a message and let go to quickly exit.
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Cover Story
LIME banking on Pofits C
able and Wireless Jamaica (C&WJ), to many, is a company known for its large scale recurring losses and its inability to fully satisfy the needs and desires of the Jamaican people. This year is no different as the company’s audited financial accounts shows recurring losses of $9,179 million (compared to $3,504 million for 2013/2014) for the group and $9,552 million (compared to $3,233 million for 2013/2014) for the Company, for the year ended March 31,2015. Meanwhile, stockholders’ net deficits valued at $33,232 million (compared with $23,826 2013/2014) and $34,269 million (compared with $24,434 million for 2013/2014) respectively as at the same date. According to the company’s auditor’s KPMG Chartered Accountants, these conditions indicate the existence of a material uncertainty that may cast significant doubt about the group’s ability to continue as a going concern. The Auditors say until the group returns to profitable operations, it remains dependent on its ultimate parent for continued financial support.
LIME unbothered l
“the company remains in good standing with the parent company who has indicated that it intends to continue to financially support the company for the foreseeable future.” Garfild Sinclair Chief Executive officer of FLOW
However, speaking at the recently held LIME Annual General Meeting, the CEO of LIME (newly merged FLOW), Garfield Sinclair, said the company remains in good standing with the parent company who has indicated that it intends to continue to financially support the company for the foreseeable future. He says with this support and the impact expected from the acquisition of Flow, the company is in good standing and expects to see continued improvement in terms of a reduction in losses.
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to flow
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Sinclair says this belief is furthered by what he says was a doubling of the operating profit from $766 million last year to $1.6 billion this year. He says this is the highest the operating profit has been in quite some time. He says it reflects increased market share and greater customer spending.
Shareholders concerned However, despite the continued attempts at reassurance by Sinclair that the company will eventually see profit and will be able to offer dividends, shareholders remain skeptical and have expressed frustration over what they say is the company’s failure to pay a single dividend in well over five years. According to minority shareholder Orette Staple, who was speaking at the AGM, only the ultimate parent and not minority shareholders have benefited from the increased market share growth of the local subsidiary, as it receives interest payments through the Cayman related party even as C&WJA continues to make losses. Staple says he is also concerned about what he says is the lending relationship between Cable and Wireless Jamaica and its parent company. He says despite the parent company’s commitment to continuous finance for the local company for the foreseeable future, “…if you have a child that continues to spend and nothing is forthcoming, then the day has to come when this has to cease.” C&WJA’s main borrowing is a $47 billion revolving facility from C&WJamaica Finance (Cayman) Ltd of which $45.5 billion was drawn down as at March 2015. The loan has no fixed repayment term and interest is charged at 100 basis points above the weighted average yield rate. According to the financials, the rate was 8.73 per cent per annum as at March 2015.
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“...If you have a child that continues to spend and nothing is forthcoming, then the day has to come when this has to cease.” Orette Staple Minority Shareholder
However, C&WJA chairman Chris Dehring, once again sought to assure shareholders responding, “…investment and continued investment has been predicated on the fact that the company is headed in the right direction. Secondly, when you’ve invested that much money it’s even harder to walk away.”
Losses to FLOW away Meanwhile, Managing Director of DenWay, Wayne Lawrence says he
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believes that this merger between LIME (Cable and Wireless) and Flow (Columbus Communications) could be the answer the company is looking for. Lawrence says while he is not willing to comment on the financial gains the merger may have, the quality of service that Flow is known for as well as the size of the operation and customer base is expected to positively impact LIME’s operations. This belief is supported once again by Sinclair who says the company now boasts almost 900,000 cell phone customers, 250,000 landline and 80,000 data only customers. Speaking at the AGM, he said these numbers suggest a continuation of strong gains in terms of the acquisition of mobile customers. Sinclair says he believes the name merger with Flow and the subsequent name change is likely to enhance the prospects for increased mobile customers leading to increased revenues and a hope that the company will begin to see profits.
Content is King For the past few weeks as we have analyzed the mergers and acquisitions dominating the Jamaican and by extension, the Caribbean landscape, several analysts and key players in the sector have stated that at this point in time, Content will be king. This week is no different. Similar to Psychologist Dr Leachim Semaj who last week said that Jamaican creative and creators of content can now expect to benefit from the merger of The Gleaner and RJR, sand Managing Director of GK Capital Management, Steven Whittingham who expressed a similar view saying that his recent acquisition of the media rights for the next 15 years for all activities and sporting events associated with the Inter Secondary Schools’ Sporting Association (ISSA) follows recent mergers and acquisitions in the Jamaican media, Lawrence says the LIME/Flow merger will even further emphasize that Content is King.
“...if LIME through FLOW expects to start seeing profits, it needs to focus on customers.”
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Wayne Lawrence Managing Director of DenWay
Focus on Quality Lawrence says if LIME through FLOW expects to start seeing profits, it needs to focus on customers. He says as long as customers believe in the quality of products and services FLOW offer, there will be no questions or concerns about if the company and its management will be successful. BM
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Financing
MSMEs urged to utilize benefits of DBJ and NCB loans
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s concerns about the availability of and Access to financing being available to Micro, Small and Medium sized Enterprises (MSMEs), they are being urged to take advantage of loans and grants offered by the Development Bank of Jamaica (DBJ) and the National Commercial Bank (NCB). Addressing the DenWay Corporation’s Inaugural SME Business Growth Breakfast Forum last Thursday, September 10, DenWay Managing Director, Wayne Lawrence said SMEs continue to suffer from several issues. He said based off a survey, among the main issues are: • Access to market information • Struggling to secure sales and grow their businesses • Access to financing • Government regulation • A need to improve productivity • Little understanding of how international markets work • And Larceny Portfolio Officer for Commercial Products at National Commercial Bank (NCB), Dale Seaton says the issues preventing SMEs from accessing financing are inability to meet the proposed monthly loan payments, insufficient information provided, poor credit history, high debt-to-equity ratio, insufficient collateral, inability to demonstrate viability of the business venture and deficiencies in management capabilities. However, Seaton says NCB believes SMEs are important as they impact exports, GDP growth and employment. He says it is because of this that NCB was the first commercial bank to establish a customized programme tailored to the needs of the SME sector. The Portfolio Officer says this includes the NCB Business Grow Plan which allows SMEs to access funds
for business re-tooling, energy projects, commercial property acquisition and to fund all other export business needs. Seaton says NCB also offers the Commercial Vehicle Loan, the Quick Biz Facility, Customized loans, an Overdraft facility, NCB Letter of Credit and several credit card options. He says the basic requirements to obtain financing include a Business overview, project description, historical financial statements, cash flow projections, details of proposed collateral and a business plan where applicable. Meanwhile, Accountant Executive in the Loan Origination and Portfolio Management Unit at the DBJ, Claudia Andrews says although the DBJ does not offer a direct loan, it works through commercial banks to provide Businesses and Entrepreneurs with financing opportunities. She says the general criteria to obtain a DBJ loan is to be a registered business operating in Jamaica, be tax compliant, be technically and Financially viable, have an equity injection of between 10 and 30% and contribute positively to the economy. Andrews says the SME loans provide 90% financing of Project Cost providing a maximum loan of J$30M. It is repayable at an Interest Rate at 10% to SME on the reducing balance with a maximum of 7 years to repay. There is also up to 12 months moratorium on the principal. And Research and Business Analytics Manager in the Strategic Services Department at the DBJ, Kamara Gibson says the DBJ is committed to providing capacity development support to MSMEs by aiding with Business Plans, Marketing Plans, Financial Statements, Mentoring & Coaching, Training Courses, Financial Software Acquisition, Testing, standards, factory layout and registering patents. BM
...SME loans provide 90 financing of Project Cost providing a maximum loan of J$30M. 14
Businessuite Weekly
Company Reports Sagicor Real Estate X Fund assumes ownership of Double Tree by Hilton Hotel in Orlando, Florida, USA
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rand Jamaica will be furthered following Sagicor Real Estate X Fund’s (X Fund) acquisition of the Double Tree by Hilton Hotel in Orlando, Florida.
Estate X Fund, Rohan Miller, says visitors to the Double Tree Hotel will be encouraged to visit Jamaica or buy Jamaican products through a ‘Try Jamaica’ campaign. He says as such, Sagicor has begun discussions with a number of Jamaican
The acquisition which was completed last week
promotional entities to launch the campaign,
Thursday, September 10, sees X Fund now in
aimed at promoting Jamaica. The ‘Try Jamaica’
control of a 742 room property rooms with over 60,000 square feet of conference and meeting room facilities. According to X Fund, over 100,000 guests visit the property annually, which is located at the entrance to the Universal Theme Park in Orlando and within easy reach of other well-known attractions such as Disney World, Seaworld, among others. X Fund says it is within five minutes of the major shopping mall, Orlando International Premium Outlet Mall and 10 minutes
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campaign is expected to be launched in early 2016.
Growth Brand Jamaica will be furthered following Sagicor Real Estate X Fund,s acquisition of the Double Tree by Hilton Hotel in Orlando, Florida.
from the Orlando Convention Center.
Miller says the acquisition of this new resort is in keeping with the company’s investment strategy to diversify its investments in real estate opportunities locally and internationally. He says this acquisition of the Double Tree Hotel now means that the X Fund will own and operate nearly 2,000 hotel rooms.Over the last four years Sagicor its managed funds have invested over US$150 million in the acquisition and refurbishing of four hotels in
The Double Tree Hotel was financed with debt of
Jamaica, namely the Hilton Rosehall Hotel,
US$51 million from Goldman Sachs for ten years
Jewel Runaway Bay, Jewel Paradise Cove and Jewel
at 4.9% and equity from the recent rights issue by
Dunn’s River. BM
the X Fund. President and CEO of Sagicor Real
“...the acquisition of this new resort is in keeping with the company’s investment strategy to diversify its investments in real estate... ” Rohan Miller President and CEO of Sagicor Real Estate X Fund
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The Week Ahead Businessuite Event Calendar 5
September 14
September 16
Rotary Club St. Andrew North Venue: Wyndham Hotel, New Kingston
HRMAJ Administration Training Workshop Venue: Knutsford Court Hotel, 11 Ruthven Road, Kingston 10 Email: hrmaj@cwjamaica.com
September 15
JMMB Investor Briefing Venue: The Jamaica Pegasus Hotel, 81 Knutsford Boulevard, Kingston
Jamaica Bridal Expo 2015 Venue: Montego Bay Convention Centre, Rose Hall, St James Email: info@jamaicabridalexpo.com
JMMB General Meeting Venue: The Jamaica Pegasus Hotel, 81 Knutsford Boulevard, Kingston
Radio Jamaica Limited 67th Annual General Meeting Venue: The Jamaica Pegasus Hotel, 81 Knutsford Boulevard, Kingston Proven Investments Ltd Annual General Meeting Venue: 20 Micoud Street, Castries, St. Lucia Blue Power General Meeting Venue: Guardsman Group Office , 107 Old Hope Road, Kingston 4 Rotary Club of Mandeville Venue: Golf View Hotel, 5 1/2 Caledonia Road, Conference Room, Mandeville, Manchester
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Kiwanis Club of New Kingston Venue: Institute of Chartered Accountants, 8 Ruthven Avenue, Kingston 10 Jamaica Association of Administrative Professionals (JAAP) St. Ann Meeting Chapter Venue: St. Ann Parish Library, St. Ann’s Bay
September 17 HRMAJ Administration Training Workshop Venue: Knutsford Court Hotel, 11 Ruthven Road, Kingston 10 Email: hrmaj@cwjamaica.com
Businessuite Weekly
Regional Dominican Republic and Haitian Chambers of Commerce sign cooperation agreement to strengthen business communities
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he Federation of Chambers of Commerce of the Dominican Republic (FEDOCAMARAS) and the Chamber of Commerce and Industry of Haiti (CCIH) have signed a cooperation agreement aimed at strengthening the bond between the business communities of both countries. The agreement looks to contribute to the development of commercial and economic relations between the two countries through the exchange of information and the participation of joint activities such as trade fairs, commercial missions, seminars, and among others the fostering of joint investments. It will cause the EDOCAMAR AS which represents approximately 8,000 Dominican companies and CCIH representing more than 1,000 Haitian enterprises, to analyze problems that arise during bi-national commercial exchanges with the aim of presenting joint resolutions to the relevant authorities in both countries. It aims to solidify the relationships between the private sectors of both nations. BM
The agreement looks to contribute to the development of commercial and economic relations between the two countries...
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Agreement signed to promote economic, social and agricultural development in Latin America and the Caribbean By Andrea Morales Mora
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nder a new cooperation agreement signed by the Mexican Agency for International Development Cooperation (AMEXCID) and the Inter-American Institute for Cooperation on Agriculture (IICA), the two organizations will join forces to contribute to economic and social development, and to implement technical cooperation programs for Latin America and the Caribbean (LAC). The agreement was signed by the Executive Director of AMEXCID, Juan Manuel Valle, and the Director General of IICA, Víctor M. Villalobos. The two officials pointed up the need to strengthen regional integration and joint efforts with a view to enhancing the capabilities of the region’s rural dwellers. According to Villalobos, the best investment that countries can make is in knowledge and training aimed at promoting the development of their societies. He also underscored the impor tance of complementing academic cooperation with technical assistance, so the rural sector improves its productivity and meets the growing demand for food for the world’s population. The agreement calls for the implementation of joint activities through regional and bilateral programs, IICA’s technical cooperation networks, and the research programs of study and research centers in LAC. It aims to promote knowledge and training for the development of agriculture. It will also strengthen Mexico’s presence in other countries of the region by promoting Mexico’s strengths and opening up agricultural opportunities, given the need to train human capital for the sector.
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Businessuite Weekly
Honduras records Mid-year economic growth of 3.6 % as IMF concludes first reviews of Stand by Arrangement and Agreement Honduras
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he Honduran Central Bank says the economy grew by 3.6% more than the same 6 month period last year. According to the Monthly Economic Activity Index (IMAE) in June 2015, the growth was influenced by Financial Intermediation, Insurance and Pension Funds, Post and Telecommunications, Manufacturing Industry, Trade, Transport and Storage, and Agriculture, Forestry and Fisheries. It says the Financial Intermediation behavior is explained by higher interest rates on credit cards, trusts and mortgage loans; and also, because of the rise in commissions received from disbursements, deposits, drafts and transfers. The announcement comes following the International Monetary Fund (IMF) completion of the first reviews under the Stand-By Arrangement and Arrangement under the Stand-By Credit Facility with the country. The country now has access to US$63.8 million. According to First Deputy Managing Director and Acting Chair of the Executive review board, David Lipton, he believes the Honduran authorities are implementing their Fund-supported economic program with strong commitment, amid improved terms of trade and strong remittance inflows. He says for 2015, the Honduran authorities have strengthened fiscal and monetary targets, taking advantage of the more favorable external environment to reduce the deficit of the central government and state electricity company (ENEE) at a faster pace than originally envisaged. Lipton says this will add to the credibility of fiscal adjustment and enhance confidence. Lipton says he has also been assured that the authorities
plan to continue changing the composition of public expenditure to create room for higher and better-targeted social spending to support the reduction of the high levels of poverty. He says the tightening of monetary targets is important to strengthen international reserve buffers and help keep monetary policy focused on controlling inflation and protecting the external position. The Acting Chair says plans to strengthen the central bank’s governance and independence will enhance its capacity to maintain stable monetary and financial conditions. However, as a word of advice, Lipton says to bolster public finances and support long-run economic growth, the authorities should press ahead with reforms in the electricity sector. He says these measures should be accompanied by full implementation of the reforms envisaged in the 2014 electricity sector law, including the implementation of plans to reduce distribution losses in the sector. Lipton says Honduras would also benefit from protecting the hard won gains envisaged under the program by establishing a fully functional medium-term fiscal framework, which would institutionalize fiscal policy discipline. He says in addition, the provisions under the recently adopted social protection framework law should be implemented gradually to ensure consistency with the program’s objectives and with longterm fiscal sustainability. This blended program was approved on December 3, 2014 in the amount of SDR 129.5 million (then about US$188.6 million), the equivalent of 100 percent of Honduras’ quota in the IMF. BM
“...to bolster public finances and support long-run economic growth, the authorities should press ahead with reforms... ” David Lipton First Deputy Managing Director and Acting Chair of the Executive Review Board
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Commentary By Mark Wignall
, Mark s Laas Lick Why T-A-X-E-S is a most hated word in Jamaica “GCT or no GCT?” asked the Chinese owner of the shop in the heart of ‘China Town’ in an area of down town Kingston where the numerous wholesale shops, retails groceries, haberdasheries and everything in between are controlled by the last wave of Chinese migrants which arrived in the 1990’s. Forty-two year old Elwood was being pressured by his girlfriend to get her a 42 inch HD TV but his pocket was only up to a 32 inch. At $30,000 tagged price, it was about $10,000 to $15,000 cheaper than prices in the uptown plazas and the big stores. “What yu mean by GCT or no GCT?” Elwood asked. The man shot back quickly as he saw other customers milling around. “You pay GCT you get receipt. You no pay GCT you no get receipt,” said the man. Elwood saw it as a no-brainier as he pondered the almost $5,000 that the 16.5% GCT would add to the price. “OK, no GCT.” The man had the TV tested, Elwood paid him and after it was packed he took it to his car parked way up the road and drove away, hoping that he would not be stopped by the police. Dorothy, the typical Jamaican go-getter rents a small 250 sq.ft. store space on the top floor of a mini plaza in the Constant Spring area. Her rent had only moved by $3,000 to $16,000 since she opened it in 2009 at the height of the global recession. She sells various beauty supplies including her best seller- skin bleaching creams and oils. Business hasn’t been good of late and some weeks she could barely make $20,000, down from better days in 2010, 2011 when a good week grossed her $70,000. Thirty five year old Dorothy wanted to know more about the Minimum Business Tax. I explained that all her registered
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proprietorship would pay is ‘just $5,000 per month.’ She became angry. “Mek dem come tek it!” she dared. “Government help me pay rent and light and water? When me is here all hours a night a try mek another sale, where is this thing called government? A not paying one red cent!” At the peak of the global recession in 2009 then Prime Minister Bruce Golding, in trying to explain one aspect of Jamaica’s tax-avoidance culture, said he had run through the data base at the Tax Administration department, 500 names of individuals who were estimated to be high income earners$15 million plus per annum. Only five of those names came up! A friend of mine has a small pest control operation. He has four vehicles used in the business. “One of my vehicles had the front-end badly damaged by potholes and it is now down. Repairs are estimated at $40,000. Straight up, I am telling you, apart from regular registration and licenses fees, I consider it my duty to avoid paying taxes. I happen to know that many ‘big’ people are not paying taxes. Why should I?” The old suggestion of making a significant increase in GCT to say, 25% while lowering income or payroll taxes to say, 15% or less has been made many times. That however takes political will. A significant increase in the GCT rate and adequate policing of its collection is something that a ruling political administration would see as deliberately handing over of power to the opposition. It will not happen. *The views expressed in this article do not represent those of Blackslate Holdings, Businessuite Magazine, or any of its subsidiaries or representatives.
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94D Old Hope Road Kingston 6 Jamaica Telephone: (876)978-5508/ 978-0426 (876)619-1351 Fax: (876)927-9125 Customer Feedback/ Queries: E-Mail: Info@cabjm.com
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