'Dear tax cheats' Finance ministry writes to 10,000 'professional' tax dodgers

Published: Sunday | August 16, 2009


Tyrone Reid, Sunday Gleaner Reporter

After firing warning shots earlier this year, the Ministry of Finance has dispatched approximately 10,000 letters to local professionals who, it believes, have not been paying their taxes.

The Sunday Gleaner understands that the 'professional' tax dodgers are again being invited to voluntarily come into the tax net, or face the full force of the law.

When contacted last week, officials at the finance ministry were not willing to comment on the latest campaign.

However, sources close to the tax operation confirmed that the letters had already been sent to entertainers, doctors, lawyers and other professionals who are robbing the country of millions of dollars.

But even as the Government goes after tax dodgers, at least one professional group has made it clear that it will not be implementing any measures to ensure that its members paid their taxes.

Dr Rosemarie Wright-Pascoe, president of the Medical Association of Jamaica (MAJ), said her association would not implement a suggestion to make tax compliance a mandatory requirement for membership.

She believes getting people to pay taxes is the Government's job, not the association's. "I think that would be encroaching on the responsibility of the Government," Dr Wright-Pascoe said.

In defence of her colleagues, Wright-Pascoe said of the 2,000-plus doctors on the island that more than 600 were employed by the Ministry of Health and were numbered among the nation's nearly 350,000 PAYE workers.

However, many of those doctors have private practices as well, and it is suspected that some are not making income-tax declarations on earnings from those practices.

'come clean'

The MAJ president encouraged her colleagues, who are either not paying or not handing over everything, to come clean. "It is an obligation that we have as citizens of this country to pay our taxes, and we encourage them to do so," she said.

However, Dr Wright-Pascoe said she was not aware of any member of the medical association who was not honouring his or her tax requirements.

Tax evasion is still a taboo issue that many people do not want to touch, and musicologist and director of Shocking Vibes Clyde McKenzie is one of them.

When contacted by The Sunday Gleaner for a comment on claims that some entertainers were not paying their taxes, McKenzie respectfully declined to speak on the matter.

Dr Pauline Knight, director of social policy, planning and research at the Planning Institute of Jamaica, said compliance was not just important to beef up the state coffers. She argued that in addition to the benefits afforded to the country, there were also individual benefits to be gained from being tax compliant.

"It is in their best interest to be making payments for social-security purposes ... . They need to think about retirement," she said.

Dr Knight added: "They are not cheating the Government, they are cheating themselves."

Finance minister Audley Shaw's push to capture professionals and other self-employed persons who have evaded the tax net comes as no surprise following a recent random sample of 500 doctors which found that 400 were not paying their taxes.

A similar study conducted by the Jamaica Confederation of Trade Unions (JCTU) in 2001, found that 94 per cent of self-employed persons were not paying taxes. According to the JCTU, with 470,000 persons self-employed, only 25,625 filed returns in 2001.

Shaw sounded the warning in April during the 2009-2010 Budget Debate.

"The tax administration will be putting the spotlight on tax cheats. Everyone must pay their fair share; no more, no less," Shaw said when he opened the debate in Gordon House.

The finance minister also announced the establishment of a forensic data-mining intelligence unit, which will be mandated to identify self-employed persons who are not paying their taxes.

tyrone.reid@gleanerjm.com