It appears that the Government of Jamaica will not be rolling back the General Consumption Tax (GCT) on group health insurance.
Finance Minister Audley Shaw was asked on Monday morning to respond to comments by Richard Byles, Chief Executive Officer of the Sagicor Group, that the tax will result in employees and their companies paying more for health insurance.
Mr. Shaw, who was speaking at the Post Budget media briefing, said the increase is a minimal $700 to $800 per employee.
He said the tax on group health insurance goes directly to employers.
“It is unlikely that companies will bother their employees by passing this on to them. Also there are regular increases by the two health insurance providers and these are absorbed by the local employers and not passed on to their employees. We therefore do not see the GCT on these policies as a burden on existing companies to reduce the level of insurance for their staff, neither do we see this as a disincentive for companies who want to provide such insurance for their staff,” Mr. Shaw asserted.
Mr. Byles has stated that only 30 per cent of Jamaica’s work force has health insurance and the tax could result in a reduction in that figure.
He said he would be seek a meeting with the Government this week to discuss his concerns.
Give back
In the meantime, Mr. Shaw said the $13.5 billion tax package is a way for Jamaicans to give back to the country.
“In the PIT (personal income tax) give-back, we are asking a part of the reciprocity is for the workers to try to lift up their levels of personal productivity and that includes a more disciplined comportment at the workplace,” he said.
He added: “I am suggesting to Mr. Byles that this also, in the case of this group health insurance, is an opportunity for the companies to see themselves playing their own part in helping to encourage further worker productivity.”
