Taxation 1 (MGMT 3051) Semester 1 2019/20

PEER EVALUATION FORM

INSTRUCTIONS:
1. Fill out this evaluation form listed below for all of your group members. This form must be completed by EACH member of the Group.
2. Only submit this page and any additional comment pages (if needed) to your Group Leader for submission.
3. Remember to assess yourself in the FIRST RATING COLUMN.
4. For each of the categories, enter the appropriate score (1- 5; 1 being the lowest and 5 being the highest).
5. As needed, enter comments about group members below the form. Use the back of this sheet or additional sheets as necessary. (If you use the
back, please indicate this on the bottom of the front page.)

ID NUMBERS

Attended meetings on a regular basis 5 4 5 4 4 4

Arrived at meetings on time 5 4 5 5 5 5
Offered pertinent ideas in meetings
5 5 3 4 4 4
Participated in discussions regarding team materials and subjects
5 5 4 5 4 4

Was always prepared for team meetings 4 3 4 4 4 4

Completed work according to set deadlines
5 3 3 5 3 3
Produced a quality of work that met or exceeded your expectations 4 4 4 4 4 4

Worked well with teammates 3 4 4 3 3 4

Helped solve disputes within the team
2 4 3 3 3 3
3 4 4 4 4 4
Supported team decisions, even if he/she disagreed with these decisions
TOTAL 41 39 39 41 38 38
 Taxation 1 (MGMT 3051) Semester 1 2019/20

PEER EVALUATION FORM

INSTRUCTIONS:
1. Fill out this evaluation form listed below for all of your group members. This form must be completed by
EACH member of the Group.
2. Only submit this page and any additional comment pages (if needed) to your Group Leader for
submission.
3. Remember to assess yourself in the FIRST RATING COLUMN.
4. For each of the categories, enter the appropriate score (1- 5; 1 being the lowest and 5 being the highest).
5. As needed, enter comments about group members below the form. Use the back of this sheet or additional
sheets as necessary. (If you use the back, please indicate this on the bottom of the front page.)

ID NUMBERS

620109533
620119050

620115393

620117875

620108437
620117431

Attended meetings on a regular basis 5 5 5 5 5 5

Arrived at meetings on time 5 5 5 5 5 5
Offered pertinent ideas in meetings 5 5 5 5 5 5
Participated in discussions regarding team materials and subjects 5 5 5 5 5 5
Was always prepared for team meetings 5 5 5 5 5 5
Completed work according to set deadlines 5 5 5 5 5 5
Produced a quality of work that met or exceeded your expectations 5 5 5 5 5 5
Worked well with teammates 5 5 5 5 5 5
Helped solve disputes within the team 5 5 5 5 5 5
Supported team decisions, even if he/she disagreed with these 5 5 5 5 5 5
decisions
TOTAL 50 50 50 50 50 50

General Comments:
 Taxation 1 (MGMT 3051) Semester 1 2019/ 20

PEER EVALUATION FORM

IN STRUCTION S:
1. Fill out this evaluation form listed below for all of your group members. This form must be completed by EACH member of the
Group.
2. Only submit this page and any additional comment pages (if needed) to your Group Leader for submission.
3. Remember to assess yourself in the FIRST RATING COLUMN.
4. For each of the categories, enter the appropriate score (1- 5; 1 being the lowest and 5 being the highest).
5. As needed, enter comments about group members below the form. Use the back of this sheet or additional sheets as necessary. (If
you use the back, please indicate this on the bottom of the front page.)

ID N UMBERS

620117875
620115393

620109533

620117431

620108437
6201190
50

Trevon Bonnick
Attended meetings on a regular basis 5 5 5 5 5 5
Arrived at meetings on time 5 5 5 5 5 5
Offered pertinent ideas in meetings 5 5 5 5 5 5
Participated in discussions regarding team materials and
subjects 5 5 5 5 5 5
Was always prepared for team meetings 5 5 5 5 5 5
Completed work according to set deadlines 5 5 5 5 5 5
Produced a quality of work that met or exceeded your 5 5 5 5 5 5
expectations
Worked well with teammates 5 5 5 5 5 5
Helped solve disputes within the team 5 5 5 5 5 5
Supported team decisions, even if he/ she disagreed with 5 5 5 5 5 5
these decisions
TOTAL 50 50 50 50 50 50

General Comments:
 Taxation 1 (MGMT 3051) Semester 1 2019/ 20

PEER EVALUATION FORM

IN STRUCTION S:
1. Fill out this evaluation form listed below for all of your group members. This form must be completed by EACH member of the
Group.
2. Only submit this page and any additional comment pages (if needed) to your Group Leader for submission.
3. Remember to assess yourself in the FIRST RATING COLUMN.
4. For each of the categories, enter the appropriate score (1- 5; 1 being the lowest and 5 being the highest).
5. As needed, enter comments about group members below the form. Use the back of this sheet or additional sheets as necessary. (If
you use the back, please indicate this on the bottom of the front page.)

ID N UMBERS

620119050

620117431
620108437
620109533

620115393

620117875
Attended meetings on a regular basis 3 4 4 5 3 5
Arrived at meetings on time 3 4 4 5 4 5
Offered pertinent ideas in meetings 5 5 5 5 5 5
Participated in discussions regarding team materials and subjects 5 5 5 5 5 5
Was always prepared for team meetings 4 5 5 5 5 5
Completed work according to set deadlines 5 4 4 4 4 5
Produced a quality of work that met or exceeded your expectations 5 4 5 5 4 5
Worked well with teammates 5 5 5 5 5 5
Helped solve disputes within the team 5 5 5 4 4 5
Supported team decisions, even if he/ she disagreed with these decisions 5 4 4 4 4 4
TOTAL 45 45 46 47 43 49

General Comments:
 Taxation 1 (MGMT 3051) Semester 1 2019/ 20

PEER EVALUATION FORM

IN STRUCTION S:
1. Fill out this evaluation form listed below for all of your group members. This form must be completed by EACH member of the
Group.
2. Only submit this page and any additional comment pages (if needed) to your Group Leader for submission.
3. Remember to assess yourself in the FIRST RATING COLUMN.
4. For each of the categories, enter the appropriate score (1- 5; 1 being the lowest and 5 being the highest).
5. As needed, enter comments about group members below the form. Use the back of this sheet or additional sheets as necessary. (If
you use the back, please indicate this on the bottom of the front page.)

ID N UMBERS

620119050

620115393
620117875

620117431

620108437
Moya Morris

Attended meetings on a regular basis 5 5 5 5 5

Arrived at meetings on time 5 5 5 5 5
Offered pertinent ideas in meetings 5 5 5 5 5
Participated in discussions regarding team materials and subjects 5 5 5 5 5
Was always prepared for team meetings 5 5 5 5 5
Completed work according to set deadlines 5 5 5 5 5
Produced a quality of work that met or exceeded your expectations 5 5 5 5 5
Worked well with teammates 5 5 5 5 5
Helped solve disputes within the team 5 5 5 5 5
Supported team decisions, even if he/ she disagreed with these decisions 5 5 5 5 5
TOTAL 50 50 50 50 50

General Comments:
 Taxation 1 (MGMT 3051) Semester 1 2019/ 20

PEER EVALUATION FORM

IN STRUCTION S:
1. Fill out this evaluation form listed below for all of your group members. This form must be completed by EACH member of the
Group.
2. Only submit this page and any additional comment pages (if needed) to your Group Leader for submission.
3. Remember to assess yourself in the FIRST RATING COLUMN.
4. For each of the categories, enter the appropriate score (1- 5; 1 being the lowest and 5 being the highest).
5. As needed, enter comments about group members below the form. Use the back of this sheet or additional sheets as necessary. (If
you use the back, please indicate this on the bottom of the front page.)

ID N UMBERS

620117875
620115393

620119050

620109533

620117431

620108437
Attended meetings on a regular basis 3 4 4 4 4 4
Arrived at meetings on time 4 4 4 4 4 4
Offered pertinent ideas in meetings 4 4 4 4 4 4
Participated in discussions regarding team materials and subjects 5 5 5 5 5 5
Was always prepared for team meetings 3 4 4 4 4 4
Completed work according to set deadlines 4 4 5 4 4 5
Produced a quality of work that met or exceeded your expectations 4 3 4 4 4 4
Worked well with teammates 5 5 5 5 5 3
Helped solve disputes within the team 4 4 4 4 4 3
Supported team decisions, even if he/ she disagreed with these decisions 5 5 5 5 5 5
TOTAL 41 42 44 43 43 41

General Comments:
 Taxation I

Coursework Assignment

Knowability Tax Corporation

Group Members ID Number

Trevon Bonnick (Group Leader) 620119050

Ashley Livingston 620115393

Shanique Harvey 620109533

Moya Morris 620117875

Allyah Davis 620117431

Gabrielle Alexander 620108437

Research Question:

What are the main economic criteria for judging a particular tax or a proposed tax

reform? Critically evaluate the fiscal adjustments: (1) to increase the income tax

threshold to $1.5M; and (2) to increase the GCT threshold from $3,000,000 to

$10,000,000 in accordance with the economic principles laid out by Adam Smith

and others. Include in your assessment the impact on taxpayers, tax administration

and the society.

 Introduction

This paper considers the modifications made by the government to

increase the Income tax threshold and the GCT tax threshold. As such, this report

assesses the concepts in alignment with the Adam Smith’s maxims of a good tax

system. The concept of taxation will be defined, and the principles laid out by

Smith will be explained. Using Smith’s analysis, an interpretation will be made to

conclude how the criteria affects the tax administration, the economy, and

taxpayers. Tax reform is another concept that will be defined and discuss, along

with its effect on Income tax. Nonetheless, the fiscal adjustments will be assessed,

regarding the increase in the income tax threshold. Lastly, the GCT threshold will

be revised in which the research speaks particularly about its increase from

$3,000,000 to $10,000,000 and how it has affected various businesses and the

economy at large.
 It is essential for a company to operate under an effective tax system.

According to the Britannica, taxation is a compulsory payment levied on

individuals or companies by the government to raise revenue for government

expenditures and other purposes across the world. However, the “Economic

Studies” defines tax reform as the reduction in income tax rates which reduces the

use of tax expenditures or other items that narrow the tax base. There are two

types of tax reforms: individual and corporate income tax reform. Adam Smith’s

analysis states four (4) main criteria to judge a particular tax or tax reform,

namely, efficiency, equity (fairness), macroeconomic considerations and

certainty.

Efficiency as a criterion might increase distortions in the price mechanism

which would affect consumers and producers. An increase in tax may influence

the degree of work, savings and investments, and the allotment of such activities

across the sectors of the economy. Therefore, if there should be a tax cut, it would

encourage individuals to work more with more finance and their spending would

also increase impacting the economy positively.

In response to fairness, it is said that everyone should pay a fair share of

taxes. As such, fairness can be divided into two sub-categories, horizontal and

vertical equity. Horizontal equity speaks to the payment of tax in similar

proportions for taxpayers who are in similar financial conditions whereas, vertical

equity refers to the payment of tax by taxpayers based on the amount of income
that the individual earns. Additionally, vertical equity can be divided in three

categories; regression being individuals with low income pay a larger share of

income taxes than those with higher income, meanwhile a proportional tax system

is where all individuals pay the same share of income tax. Progressive tax system

requires the higher income earners to pay higher income tax in comparison to the

lower income earners.

Nonetheless, macroeconomic consideration may impact the economy as

income will possibly be small. That might be to some degree since huge duty

changes probably have various and regularly balancing consequences for the

economy. Furthermore, on the grounds that parts of the economy are continually

changing, precisely estimating the income impacts, even afterward, is

troublesome if not impossible. Whilst the final criteria which is Certainty

indicates that taxpayers should be clearly informed about how and why taxes are

levied. This criterion aims at maintaining a stable regulatory and policy

framework for tax administration, taxpayers, and tax compliance. Tax certainty is

crucial to stimulate economic growth; investors believe that a predictable tax

system is essential when operating a business. Additionally, government outlined

that companies should pay their fair share of taxes to keep a stable public finance

system which will make tax regimes predictable, and make sure taxpayers are

appropriately taxed. Therefore, aforementioned criteria laid out by Adam Smith,

will be used to assess the increase in the Income tax and GCT threshold.
 With a good tax administration system to efficiently bring in tax revenue

for the country, it is essential for the government to keep a control over their fiscal

adjustments. Fiscal adjustments can be defined as a reduction in the government’s

primary budget deficit which may result from a decrease in government

consumptions, an expansion in charge incomes, or both simultaneously. It is the

key to achieving positive effects on macroeconomic activities to promote

economic growth and a steady reduction of poverty for the country. The fiscal

adjustment in Jamaica to increase the income tax threshold to $1,500,096 was set

in effect on April 1, 2017.

According to the Ministry of Finance (2016), this adjustment was set to

exempt approximately 400,000 taxpayers whose income were below the

threshold. With this change, the impact of inflation in Jamaica was anticipated to

be a negligible 0.2%. However, to aid in the increase of the income tax threshold,

the ministry progressed to raise more revenues by being tougher on tax evaders,

increasing Special Consumption Tax (SCT) on petrol to seven dollars ($7.00) per

liter which would yield 6.489 billion dollars per year, and by increasing some

indirect taxes that were deemed less harmful to economic growth. Nevertheless,

SCT increase did not have a direct negative effect on consumer goods and

services as it aids to preserve the integrity of revenues. The continuous decrease

in oil prices in the fiscal year 2015/2016, lead the government to allocate twenty-

seven billion dollars ($27B) to social programs. Six billion dollars ($6B) were
allocated to the Ministry of Labor and Social Security to continue the implication

of social protection programs such as PATH.

An increase of the income tax threshold enables job creation for the public

and provides the confidence the public needs to attain these jobs while abiding by

the tax laws enforced by the tax administration. Since the new threshold increases

capital gains for individuals, it essentially promotes economic efficiency and

equity as the tax base is relatively broad in Jamaica. In accordance with Adam

Smith’s theory, the new income tax systems promote simplicity/certainty as tax

payers are able to calculate their tax returns; persons whose income are below the

threshold pay no income tax, persons above the threshold pay 25% of the

remaining balance (exempt the 1.5m from income and tax the remaining) and

persons whose income exceeds six million dollars pay 30% income tax of the

excess amount (25% of the amount over the threshold and 30% of the amount

over $6 million). This has also shown that the tax system is fair as it encourages

persons who fall in the same tax bracket to pay similar amounts in income tax

which promotes equity in relation to the principle.

In March of 2019, the bill of increasing the GCT threshold from

$3,000,000 to $10,000,000 was approved in Jamaica with the intention of

reducing business’ burdens. General Consumption Tax (GCT) is a Value Added

Tax on consumption and is added to the price of goods and services provided,

Burke (2020). Additionally, the GCT threshold is the annual gross

turnover/revenue level at which a person undertaking a taxable activity is required

to register for GCT as defined by Gordon (2009). This includes any such activity

carried out in the form of a business, trade, etc. It must supply (or intend to

supply) goods and services to others for a consideration, but not necessarily for

profit. The benefit for those business operators below the $10,000,000 threshold,

is not required to pay GCT nor file monthly returns as they will be spared the

administrative stress and cost of being forced to comply with these GCT

requirements. This had been long debated as the last bill was updated in 2009. In

performing the fiscal adjustment, an estimated $0.731 billion in loss was incurred

for the 2019/20 fiscal year by the government with hopes of the adjustment being

successful in the long run.

Burke (2020) asserted that the increase in the GCT threshold was to foster

growth in the economy (particularly in the micro and small business sectors),

economic independence and the exploitation of economic activities while

protecting the poor and vulnerable. Therefore, the average each month is

$833,333.33 gross sale or revenue threshold for persons before engaging in a

taxable activity. The Tax Administration benefits from this increase as it will

reduce the administrative burden of having to police the 3,500 GCT registered

taxpayers who will be removed from the net. There is an impact on Income Tax,

as persons will be able to recover more losses thereby reducing their statutory
income or business income tax. With all the realized benefits of this increase in

the GCT threshold, some taxpayers were restricted.

According to Adam Smith’s analysis on equality, he argued that taxes

should be proportional to income. In relation to the GCT threshold, it is not fair

for those businesses earning above the $10 million dollar threshold, as such, only

small business owners will benefit. However, to some extent, it covers the fact

that individuals pay tax based on their “ability to pay”. The new threshold also

covers Smith’s principle of convenience, that is the time available for the

contributor to pay the tax. For instance, if land revenue is collected at the time of

harvest, it will be convenient since at this time farmers reap their crop and obtain

income. Convenience also makes it easier for small businesses as they are no

longer required to file monthly returns. They also benefit from not paying large

tax amounts; hence, they can focus more on the initial business productivity and

growth.

In addition to the canon of certainty, Smith stated that the tax which

everyone is bound to pay ought to be certain, and not arbitrary. The reasoning can

be held that since the amendment to the GCT threshold made in 2009, much work

is not required by businesses in preparing GCT returns. The process is concise

and there is more certainty as to what the requirements are. Individuals within the

society may have also realized an increase in average income over. In conclusion,
government’s tax revenue increase, and businesses may earn more from increased

consumption; win-win for taxpayers, the government and society.

References

Brookings.edu. 2020. [online] Available at: <https://www.brookings.edu/wp-

content/uploads/2016/06/09_effects_income_tax_changes_economic_gro

wth_gale_samwick.pdf> [Accessed 24 October 2020].

Encyclopedia Britannica. 2020. Taxation - The Benefit Principle. [online]

Available at: <https://www.britannica.com/topic/taxation/The-benefit-

principle#ref72014> [Accessed 16 October 2020].

Patterson, P., 2020. Finding Solutions: Taxes. [online] Pgpf.org. Available at:

<https://www.pgpf.org/finding-solutions/tax-reform> [Accessed 16

October 2020].

Jamaica: 2019/20 Budget Pursuing Growth with Equity. (2019). Retrieved from

https://www.pwc.com/jm/en/services/tax/pdf/pwc-jamaica-2019-20-

budget-newsletter.pdf

Mof.gov.jm. 2020. Increase In General Consumption Tax Threshold - Ministry

Of Finance & Public Service. [online] Available at:

<https://mof.gov.jm/mof-media/media-centre/press/2599-increase-in-

general-consumption-tax-threshold.html> [Accessed 5 November 2020].

Jamaica Observer. 2020.A History-Making Budget. [online] Available at:

<http://www.jamaicaobserver.com/business-observer/a-history-making-

budget_159309?profile=1056&template=MobileArticle> [Accessed 2

November 2020].

Mof.gov.jm. 2020. Increase In General Consumption Tax Threshold - Ministry

Of Finance & Public Service. [online] Available at:

<https://mof.gov.jm/mof-media/media-centre/press/2599-increase-in-

general-consumption-tax-threshold.html> [Accessed 2 November 2020].

Your Article Library. 2020. Top 4 Principles Or Canons Of A Good Tax System.

[online] Available at:

<https://www.yourarticlelibrary.com/economics/taxation/top-4-principles-

or-canons-of-a-good-tax-system/38120> [Accessed 4 November 2020].