C. ROLE OF THE STATE

JCTU is committed to Jamaica having a thriving and dynamic, private, social, productive sector, and civil society. However, in our present system of social inequality and economic insecurity, the notion of minimalist government is not acceptable. The State must play a major role in the public life in:

a) Macro economic management;

b) Civic peace;

c) The amelioration of the conditions of poverty;

d) The efficient provision of public facilities and infrastructure;

e) Ensuring affordable, accessible, efficient and acceptable health care for each member of the population;

f) Provision of good public education and training;

g) Adequate Health Care;

h) Environmental protection;

i) foreign relations and trade

j) the promotion, preservation of the positive elements of the Jamaican culture.

D. THE ROLE & EFFECTIVENESS OF THE PUBLIC SERVICE

The JCTU agrees that the effectiveness of the public sector is an important ingredient in the achievement of the earlier objectives identified. We therefore insist that there should be:

(a) agreement between the major political parties, the private sector, representatives of a civil society and public sector and workers' organisations, on the role of the State and the nature and quality of the public sector and the numbers required to fill that role;

(b) a Human Resource Development Policy that is geared towards institutional memory and succession planning; in an environment where the historical data and the system in place.

(c) simplification of the governmental decision-making and service delivery processes to ensure that they emphasise evaluation, accountability and clear performance criteria;

(d) acceptance that government and its agents and agencies, should be subject to all the requirements of the major Labour Legislations - specifically the Labour Relations and Industrial Disputes Act (LRIDA), the Employment (Redundancy) Payment Act, as is the case for private sector employers;

(e) reform programmes to ensure that the productivity of the Public Service by:

i Optimum utilisation of manpower - equipment and capital

ii Better trained, equipped and motivated employees

iii Improved technology

iv Elimination of ineffective laws, regulations and standards

v Better design of services to meet constituents' need

vi More precise identification of needs and users

vii Substitution of capital and technology for manpower

E. ECONOMIC GROWTH

Given Jamaica's ongoing social and economic challenges the only real solution is economic growth. It is also Economic Growth that will resolve the issues of:

(a) Government's fiscal deficit

(b) The heavy burden of Public Debt

(c) Creating jobs and enhancing the Take Home Pay of Jamaican workers; because in the final analysis, it is only economic growth that will lessen the tension between Public Policy and Take Home Pay.

With regard to Taxation, one restraining element, for economic growth in Jamaica has been the apparently quite significant size of the informal sector. In fact, a large part of the Labour Force is dedicated to unreported activities. These individuals consume services in health, education, national security and protection, without paying their fair share of taxes.

F. TAXATION

The current tax system in Jamaica is primarily composed of:

"(1) a 15% VAT of the consumption type;

(2) an income tax of 33 1/3 per cent on the return on Capital;

(3) Flat income tax on individual income at a rate of 25 per cent with a minimum exempt income level;

(4) Excise taxes and import duties that are equivalent to consumption taxes;

(5) Taxes on labour income - NIS/NHT/HEART/Education Tax;

(6) Property Tax - Stamp Duty Levies and other levies."

Clearly, tax reduction or removal in one area, necessitates tax increase in another. Given the critical role of the Informal Economy in Jamaica and the continuing problems with tax compliance, the Confederation supports a bias towards Consumption Taxes as a major method of resolving those problems. Major Policy Initiatives

The JCTU submit that the State must undertake three major initiatives

(a) Jamaica's principal Macro-Economic problem is the heavy burden of the public debt. There is a critical necessity for an agreed strategy for the reduction of public debt servicing costs. We recommend that this be done primarily by a policy of the restructuring of public debt maturities;

(b) We support the State's intention for a comprehensive review of Jamaica's Tax policy and its implications for Economic Growth and Equity;

(c) The State must intensify its efforts for greater Tax Compliance

G. TAX ISSUES 2003

In keeping with the Confedera-tion's demand to shift taxation towards consumption, we propose that the CGT be reformed; to make it a uniform Value Added Tax, with very few exemptions. The State should then seek to:

(1) deal with vulnerable groups by targeted public expenditures, in Social Protection Programme, Nutrition, National Health Pro-gramme, Work Fair Programmes, Social Security, Education/Training;

(2) ensure that the self-employed pay taxes that are legally required - Education Tax ­ NHT, NIS and HEART

(d) lower the rate of PAYE as these other measures come into effect.

With regard to the Cess on Imports, it is our recommendation that the State enters into dialogue with the productive sector, in light of the continued devaluation of the Jamaican dollar.