NAME OF FEATURE | THE GLEANER | SUNDAY, FEBRUARY 2, 2025 27 INTERNATIONAL CUSTOMS DAY/CUSTOMS WEEK FEATURE THE JAMAICA Customs Agency (JCA) plays an integral role in supporting Jamaica’s economic growth and sustainable development by facilitating efficient customs processes and the enforcement of various laws and regulations, pertinent to the cross-border movement of cargo and people. The revenue generated from these activities accounts for at least 35% of the Government of Jamaica’s (GoJ) tax revenue and 10% of the gross domestic product, annually. Two such legislative frameworks enforced are the Fiscal Incentives (Miscellaneous) Act of 2013, aimed at stimulating key sectors of the economy, and the Charities Act of 2013, the provisions of which have the effect of reducing the tax liability on businesses and registered charitable organisations. The reduced tax liability is a cost to the government, in the form of potentially foregone revenue, referred to as tax expenditures. Many charitable organisations focus on social services, including education and healthcare, as well as community rehabilitation and development. They play a significant role in alleviating poverty and addressing inequality. The GoJ supports the contribution of charitable organisations by relieving the applicable duties, taxes and fees on designated charitable consignments. For the period January to December 2024, the tax expenditure processed by the JCA was approximately $1.9B. This partnership ensures that more resources are directed toward social welfare and community development. This positive impact on socio-economic well-being supports Jamaica’s security and prosperity through a healthier, more educated, engaged and productive workforce. The fiscal incentives benefit a wide range of sectors, including manufacturing, tourism, healthcare and the creative industries, through exemptions of duties, deferral of taxes and discount on fees. For the calendar year 2024, the tax expenditure in respect of productive inputs was $170.1B. The government deems this a worthwhile investment designed to improve affordability and quality service delivery to Jamaicans and encourage local expanded production of goods and services, job creation, export promotion and competitiveness in global markets. Effective April 1, 2024, the De Minimis Value – the maximum value on which duties and taxes are not levied, was increased from US$50 to US$100. This policy shift is intended to boost e-commerce activities and greater operational efficiency at the JCA. Additionally, the passenger duty-free threshold for personal and household effects was increased from US$500 to US$1,000. As such, passengers travelling with or who have unaccompanied dutiable items of value not exceeding US$1,000, are not required to pay duty and taxes. The total benefit accruing to passengers from April 1, 2024, to December 31, 2024 was $2.6B, and reflected an increase of 73% from the $1.5B recorded for the same period of the previous fiscal year. This is indicative of greater utilisation of the benefits provided by the government. Aggregately, the total tax expenditure or revenue foregone for the period January to December 2024 was $179.2B. While fluctuations in the benefits accruing to respective sectors were observed, the aggregate value remained flat year-on-year. Despite the significant tax expenditure, the JCA maintained its revenue collection efficacy. The average revenue yielded from each dollar of imports remained unchanged at 24%. Continuous improvement of the revenue assurance mechanisms, as well as the nature and composition of the respective year’s tax base, may have contributed to this result. The JCA’s revenue assurance mechanisms are designed with you in mind – equitable collection and revenue adequacy to support the GoJ’s socio-economic programmes. These include valuation assessment and classification, passenger baggage and cargo inspection, post-clearance audit and arrears management. Through a risk-based approach, these activities are effected to ensure compliance with customs laws and regulations, as well as affiliate legislations. For instance, through the diligent effort of the Post Clearance Audit Team, additional revenue of $0.464B was assessed for calendar year 2024, and reflected a 61% increase from the $0.288B assessed for 2023. This additional assessment represented only 0.2% of the total merchandise trade revenue for 2024 but a significant step towards achieving equitable collection. The merchandise trade revenue for the reviewed period was $296.3B JCA PROMOTES ECONOMIC GROWTH THROUGH EQUITABLE REVENUE COLLECTION AND MANAGEMENT PLEASE SEE REVENUE, 28
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