By Daraine Luton—
Importers of goods for temporary use are set to benefit from the removal of general consumption tax (GCT) on such items starting Wednesday when the amended GCT Act takes effect.
The provision, according to Senator Sophia Fraser-Binns, will be a major boost for the cultural and entertainment sub-sectors, which now pays GCT on such items.
“The filmmaker, the person who will be bringing in goods for any kind of entertainment activity, now knows that there is no double taxation taking place. They know that they can bring in that which they need for their event without having to concern themselves about taxes,” Fraser-Binns said.
The overhaul of the GCT regime is a requirement under Jamaica’s four-year extended fund facility with the International Monetary Fund (IMF).
MOVING CULTURE FOWARD
The provision, which Fraser-Binns said would greatly assist the cultural and entertainment sub-sectors, states that no tax shall be payable on goods that are imported, where it can be established, to the satisfaction of the Commissioner of Customs, that goods are imported for temporary use and the importer will re-export the goods after they are used.
Rick Elgood, filmmaker and head of Geejam Media, told The Sunday Gleaner that the amendment is a step in the right direction.
“In the international film and television broadcast industry, we rely heavily on specialised pieces of expensive rental equipment to be brought in from abroad. The equipment is not available in Jamaica and so, by releasing them from the burden of GCT, it will make our local industry much more viable and competitive,” Elgood said.
He says a lot of production budgets rely upon 50 per cent initial outlay, and so “to have to import this equipment and only have 50 per cent of our working capital makes it very hard for us to complete production”.
Damion Crawford, the state minister with responsibility for entertainment, said the amendment would “make it easier for events to bring in equipment”, but expressed fear that it would “threaten the viability of our equipment rental business”.
“So while it helps users of such equipment, it can compromise the competitiveness of the local providers of said equipment,” Crawford said.
He, however, argued that the amendment would make Jamaica more competitive in attracting movies and international events like House Music Festivals which the ministry is targeting.
Ricardo ‘Ricky’ Chin, CEO, Ricardo Chin Production Services Limited, an entity which is involved in event management and production, said Jamaica Trade and Investment (JAMPRO) would need to have a central role in the operation of the new law if it is not to work against local investors.
INVENTORY NEEDED
According to Chin, JAMPRO should set up an inventory of all equipment on the island and that the Commissioner of Customs should rely on it for guidance on whether to grant ‘no-tax’ status for certain imports.
“Take, for example, audio equipment, the only way you should be bringing those in (under this regime) is if they are not on the island. If you need some basic stuff and it is here, you should not be allowed to import,” Chin told The Sunday Gleaner.
“At this point and time, many people have invested millions of dollar in this industry and are finding it hard to make back their money. It would become even worse. We need to still protect the local industry,” Chin added.
You must log in to post a comment.