Letter of the Day | Why Jamaica’s fiscal promises collided with the storm

THE EDITOR, Madam:

In its 2025 manifesto, I Choose Jamaica: The Next Chapter, the Jamaica Labour Party anchored much of its economic appeal on stability and the assurance of “no new taxes”. That promise, alongside commitments to reduce income tax burdens, resonated with Jamaicans weary of constant fiscal pressure.

The 2026–27 Budget, however, reflects a very different economic landscape.

Government has now introduced a sweeping revenue package projected to raise roughly $29.4 billion in a single year – including a new Special Consumption Tax on sweetened beverages, digital economy taxation, higher sin taxes, broader environmental levies, and adjustments to concessions and tourism GCT. These measures mark not minor tweaks but a structural shift in Jamaica’s revenue model.

The centrepiece sugary drink tax alone is expected to generate $10.1 billion in its first year. While Finance Minister Fayval Williams has framed it as a public-health intervention, its flat design – taxing low-sugar and zero-sugar beverages the same as high-sugar products – weakens reform incentives and risks functioning primarily as a regressive consumption tax.

Yet beyond policy design lies a deeper issue Jamaicans must confront: climate change has permanently altered the country’s fiscal reality.

Hurricane Melissa and recent climate shocks did more than cause emergency damage. They destroyed economic activity, reduced tax collections, raised long-term infrastructure costs, and expanded social protection needs – all while demanding massive rebuilding investments over many years. Disaster insurance and emergency funds softened the immediate blow, but they were never intended to finance long-term recovery or restore lost revenue streams.

In that context, additional revenue was economically predictable. What was not predictable – or transparent – was the political narrative that preceded it.

Citizens were led to expect continued tax stability when climate-driven fiscal pressure was already mounting. When governments delay honest conversations about unavoidable trade-offs, they merely concentrate it into sudden budget shocks that erode trust.

The challenge before Jamaica is not whether revenue must rise – climate reality ensures that it will. The real challenge is how to raise it fairly, transparently, and in ways that protect vulnerable households while encouraging healthier and more resilient economic behaviour.

Manifestos must now reflect the age of climate economics, not the comfort of yesterday’s assumptions. Honesty is the foundation of sustainable governance.

DUDLEY MCLEAN II

dm15094@gmail.com