The Grenada government has unveiled its controversial National Reconstruction Levy (NRL) in the face of opposition from trade unions on the island.

In delivering the 2006 budget last Friday in Parliament, Finance Minister Anthony Boatswain announced that the levy would be set at 3% of workers salaries for the first six months of the year and then raised to the full 5 percent by mid-year based on recommendations made by the island’s leading private sector grouping.

As the senior government minister was addressing the House of Representatives, trade union leaders and their members had assembled neat to the Golf Course Gap in Grand Anse for a march to the Grand Anse Tennis court to protest the actions of the Keith Mitchell-led New National Party (NNP) administration.

The following statement was made by Minister Boatswain on the controversial levy:

Our people have also been called upon to contribute their share, to the reconstruction effort. In this regard, the National Reconstruction Levy will take effect as of this month.

In keeping with a recommendation from the Grenada Chamber of Industry and Commerce, Government has agreed that for the first six months, persons earning in excess of EC$1,000 per month and up to EC$5,000 per month, will now be required to contribute only 3%, as opposed to 5%.

During this time (that is the six month period) agreement will be reached on provisions for the exemption of allowances. In this regard, a subcommittee consisting of members of the Multipartite Committee will develop the modalities for exemptions and make recommendations to Cabinet. It is expected that the subcommittee will conclude its work by March of this year.

Effective July 1st the rate will increase to 5% for persons earning up to EC$5,000 per month, with the first EC$1,000 being exempt. All other provisions of the National Reconstruction Levy will remain the same, that is to say, persons whose income ranges from EC$5,001 to EC$9,000 per month will make a flat contribution of EC$225 per month; while those earning in excess of EC$9,000 per month will be required to make a flat contribution of EC$350 per month.

Mr. Speaker, we have received numerous calls from citizens both within and outside the country expressing an interest in making a contribution to the national reconstruction effort, although they do not qualify to do so.

I wish to inform such citizens that contributions can be made to the Government of Grenada Reconstruction Fund at First Caribbean International Bank, number 6482996.

We greatly appreciate the interest shown by these patriotic Grenadians in the rebuilding of the country.

Mr. Speaker, we have said on several occasions that asking our people to make a financial contribution at this time is undoubtedly one of the most difficult decisions that this Administration has had to make over the past ten years.

However, we regard this as a short-term sacrifice – one which will open up new avenues for obtaining additional external financing for our country, in critical areas like Housing Reconstruction, Agricultural Rehabilitation and Youth Development. We seek the patience and understanding of our people in these difficult times.
Mr. Speaker, we can now safely say that the reconstruction of our economy is very much on track, and therefore, what is now required is for us to embark on addressing the longer-term challenges facing our Country.

Our economy needs to be revitalized. We need to return to the growth and stability that we enjoyed before the recent shocks.