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Jamaica withdraws plan to tax bank transactions

May 1, 2014

KINGSTON, Jamaica (AP) — Jamaica’s finance minister says the government is scrapping a widely criticized plan to tax islanders’ withdrawals from banks.

Peter Phillips told Parliament on Wednesday that the proposed tax on bank transactions will be replaced with two new tax proposals — a 15 percent withholding tax on certain insurance premiums and a modification of tax rules for imported services.

The idea of taxing individuals’ withdrawals from banks prompted widespread criticism. The main opposition party threatened to call street demonstrations unless it was withdrawn. Some residents wore black on Friday in protest.

Phillips assured lawmakers that the government listens. During her budget address Tuesday, Prime Minister Portia Simpson Miller had said she noted the opposition to the bank withdrawal tax.

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