‘flawed stimulus PLAN’
The proposals outlined in the mini budget presented by Prime Minister of Barbados and Minister of Finance, Economic Affairs and Investment, Mia Mottley, are being described by a member of the Democratic Labour Party as ‘economic foolishness’.
This is the view of DLP member, Dr. David Estwick, as he made a few remarks during a press conference, which was held at the DLP headquarters yesterday evening. Dr. Estwick described it as a flawed stimulus programme.
He noted that the Central Bank Governor in his May report indicated that the economy was on a declining growth path. Given the state of the declining economy, how then, he wondered, was it smart to increase taxation seemingly across the board?
“You cannot get more out of the economy that you would have gotten before because the economy is heading to a recession,” he said.
“In addition to that you would have gone ahead with a corporation tax increase, an airline tax and a tourism development tax increase, health care cost increase, income tax increase, water increase, accommodation in the tourism sector tax increase, online transaction cost increase; so I’m trying to understand how that marries and works with a declining economy, a shrinking revenue base?” he queried.
Dr. Estwick further expressed that he could not see, given the shrinking revenue base, how the Government intended to achieve any of the targets they set out to achieve.
“This is economic foolishness!” he exclaimed.
“In addition to that, when you go on the other side, which is the expenditure side, which is why I said it is a flawed stimulus programme, you increase cost in sanitation, education, healthcare, transport and roads and other expenditure of 8.7 million and obviously these additional expenditures being brought on and you do not have a sense that you can achieve any of those revenue targets given that the economy is reclining.
“I remember the then opposition saying that we were not reaching targets due to the increase of taxes, but yet you proceed to increase taxes even more and want to reach the intended targets,” he stated.
Dr. Estwick highlighted that the DLP accepted the fact that the BLP was in Government, but believes that it was their right to highlight and point out any shortcomings in the presented budget.