Dear Editor,

Mr Sean Brignandan’s letter, “People who earn $28,000 a month may pay about 10% in taxes,” (SN December 10, 2007) gives Job’s comfort only to those whose gross monthly income is below the taxable threshold.

(How those people survive on $28,000 or less per month will never be addressed by Mr Brignandan whose roti seems to be “prapa soaked in surwah.”) What about those of us whose incomes are above that figure?

Consider a Mr X whose gross monthly income is $46,000. Mr X pays income tax on 1/3 of the excess above $28,000, that is, $6,000. NIS is 5.2 % of the gross = $2,392.

Using Mr Brignandan’s not unreasonable assumption that about 4.8 % of a person’s income goes to VAT – since not everything is subject to the 16 % VAT – the minimum Mr X pays in VAT every month may be around $ 2,208. His combined monthly taxes is $10,600, which is 23 % of his income, a not inconsiderable quantum.

But this is only a minimum estimate for a Spartan Mr X. If Mr X wants to live the Guyanese dream as promised to his grandparents and parents and children by two regimes of honest Brutus politicians, and as currently being enjoyed by the elites and massas, then he is in trouble.

Like the street urchin looking at the fancy cakes behind thick glass cases, Mr X can only look at comforts that might forever be out of his grasp. You cannot promise people milk, honey and grapes and then expect them to be content with dry biscuit, mouldy cheese and trench water.

To aid the calculation for other income levels, the following formula based on the above assumptions and rates, is very handy: (13G – 280,000)/30 = T, where G = monthly gross income and T = combined monthly taxes. I have just discovered that about 32 % of my income goes to combined taxes.

Mr Brignandan is right on one score, though: 55 % of our incomes is not paid out in taxes.

This is cold comfort for people struggling to make ends meet. I believe the 55 % figure was arrived at by crudely adding the 33 1/3 % PAYE, the 5.2 % NIS and the 16 % VAT. This kind of mathematics is called street mathematics and belongs to the same genre of spin-doctor mathematics, as when we are told that we are better off than 15 years ago, but inflation and the cost of theft and mismanagement are cunningly left out of the equation.

Yours faithfully,

M. Xiu Quan-Balgobind- Hackett