Opposition Spokesman on Finance Julian Robinson
Opposition Spokesman on Finance Julian Robinson has issued a bold warning Jamaica's two largest commercial banks, declaring that if the People's National Party forms the next government, as the new finance minister, he will withdraw government low-cost deposits from their institutions if they attempt to hold the country hostage over tax reductions.
Mr. Robinson's remarks come in response to strong lobbying efforts by the banking giants, who have made it clear that they will not reduce their interest rates unless the government slashes the corporate income tax rate from 33.33% to 25%.
They also want the government to eliminate the 0.25% tax on their asset base of $2.6 trillion, representing 79% of the country's GDP.
As at November last year government, municipal corporations and public bodies had approximately $150 billion in deposits in the commercial banking system with Scotiabank and National Ccommercial Bank holding $105 billion.
The opposition spokesman characterised the position of the banks as a direct challenge to the government's authority and economic policy, warning that if he assumes the role of finance minister, he will not yield to pressure tactics that put corporate profits above the well-being of ordinary Jamaicans.
This stance signals a potential shake-up in the banking sector, where government deposits serve as a major source of low-cost liquidity for financial institutions as the interest rate is around 2%.
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