MOHW HSSP – Failure to Deduct $6.52M in Withholding Taxes

Auditor General's Findings

The 2023/2024 Auditor General’s Annual Report (subsections 3.2.158–3.2.167) covered the audit of the financial statements of the Support for the Health Systems Strengthening for the Prevention and Care Management for Non-Communicable Diseases Programme (HSSP) for the period ended March 31, 2024.

The HSSP is funded by a US$50 million loan from the Inter-American Development Bank (IDB) and counterpart funding of US$87.2 million from the Government of Jamaica, with the completion date extended to March 24, 2027. The Project’s accounting records were properly maintained and expenditures incurred in accordance with the Loan Agreement and GoJ guidelines (3.2.161).

However, as at March 31, 2024, the Project had cumulatively spent US$25.8 million (19%) of the US$137.2 million programme budget since implementation in 2019, hampered by poor planning in the project design and conceptualisation phase, the COVID-19 pandemic, and delays in filling key positions (3.2.162). Following restructuring (June 2022–December 2023), the PIU implemented 14 of the 19 restructured activities, but an assessment of whether these activities were meeting their targets was not possible as the PIU had not developed an implementation plan (3.2.164).

The audit further found (3.2.167) that the MoHW failed to comply with the Tax Administration’s guidelines by not deducting the required 3% withholding tax from payments to 40 consultants (contracts totalling approximately J$581 million), resulting in $6.52 million in taxes not being remitted as of March 31, 2024, a loss of revenue for the GoJ that also exposed the Project to potential penalties, interest and surcharges.