Sunday, November 17, 2013

The private sector in The Bahamas was challenged to present a viable alternative to Value Added Tax (VAT) ... by Prime Minister Perry Christie

Pm Challenge On Vat Alternatives

Tribune Staff Reporter

PRIME Minister Perry Christie yesterday challenged the private sector to present a viable alternative to Value Added Tax.
Responding to the concerns of businessmen worried about how VAT will affect the cost of doing business, Mr Christie pointed out that after the public rejected the option of boosting revenue by regulating web shop gaming, the government had to find some form of taxation to sustain development.
“We require additional revenue to be able to meet debt servicing obligations,” he said, “we need additional revenue to be able to have a resurgence in the economy, we need additional revenue for infrastructural development. The question is, when the government sought to seek the Bahamian people’s approval on the referendum, the Bahamian people indicated no.
“The government then brought forward what has been in play for a very long time – Value Added Tax. If there is serious objection to it, the government must listen and the government must give consideration, but the government surely would not be expected to just listen to those who oppose without having an alternative.
“Everyone in the country must know that to sustain our development, for there to be sensible, serious, forward looking discussion, it has to be accompanied – particularly from people who are involved in the economy – it has to come with alternatives.
“I would expect therefore if [businesses] are going to present me with a paper, they will be arguing to agree on a different form of taxation.”
Mr Christie has hinted that he might be open to postponing the VAT target implementation date of July 1, 2014, if the government is not prepared for it.
He said the private sector needs to realise it is on a collision “cause” with government over the need for additional revenue, and asked “what is the alternative” to VAT?
The Prime Minister added that he was not at all concerned over the level of angst being expressed by the business community regarding VAT and the potential problems it might cause for individual businesses.
“Quite frankly,” he said, “I am appreciative of all of the discussions that are taking place on VAT.
“At some stage I am sure the business community, (will recognise) that we are on a collision cause – c.a.u.s.e – with respect to this matter, that we need additional revenue.”
The government is proposing to implement VAT on July 1, 2014, at a rate of 15 per cent, with the hotel industry to be subject to a lower 10 per cent rate.
Mr Christie said, however, that ultimately, he will have the final say on implementation.
For their part, the co-chairs for the private sector’s Tax Coalition have praised indications that the Prime Minister was open to postponing VAT implementation day as “fantastic”, warning it was “paramount” that the economy be protected.
Pointing out that the government would not achieve its revenue-raising objectives if the economy “went to hell in a hand basket”, Robert Myers said he was interpreting the indications positively, and as a sign that the government was listening to the private sector’s concerns.
November 08, 2013