Tuesday, Sep 25, 2018
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Ignorance of budget rules and conventions

Dear Editor,

For those who have a nodding acquaintance with the rules and conventions of Cabinet government as practised in a parliamentary democracy – particularly one like ours which follows the Westminster model – it is quite surprising to see people who ought to know better complaining about how they were blindsided by the increase in the valued-added tax (VAT) by Finance Minister Peter Turnquest.

Some in the business community who suggest that the minister should have consulted with them first can be forgiven. Their sin is more ignorance than arrogance since they seem to think that the level of taxes to be imposed in a national budget is the same as other issues where governments can, and perhaps should, conduct prior consultation.

The operators of gaming houses who think the government was bound to consult them in advance of increasing their taxes border on both ignorance and arrogance but, having regard to recent history, can perhaps be forgiven for both.

But members of Parliament and media leaders should know better. They should educate the public rather than joining the hysterical chorus about the lack of consultation and foreknowledge of the tax increases in the national budget.

After the budget communication citizens are free to criticize the provisions of the budget to their heart’s content. But prior consultation or notice of intent are off the table.

The leaking of details of a national budget – especially the tax provisions – prior to the delivery of the budget communication by the minister of finance (chancellor of the exchequer in Britain) in Parliament is considered a cardinal sin. There are several reasons for this but principally because no-one should be given advance knowledge which can be unfairly exploited.

Perhaps the best case for reference is that of British Chancellor of the Exchequer Hugh Dalton who, on the way to Parliament to deliver his 1947 budget communication, stopped for a chat with a newspaper friend. He gave the journalist a few details of the taxes he was about to announce: “No more on tobacco; a penny on beer; something on dogs but not on horses; increase in purchase tax but only on articles now taxable; profit tax doubled.”

There was no time for this to be published in a newspaper before the speech but it was circulated by word of mouth just 20 minutes before the chancellor began his address.

Dalton admitted his error, apologized and resigned.

 

– Diogenes

 

 

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