Monday, February 17, 2014

We do not support value added tax (VAT)

Some Family Is. residents “clueless” about VAT

Guardian Staff Reporter

With fewer than five months before the implementation of value-added tax (VAT), several residents on two Family Islands said they have been left in the dark about the planned tax.

Iris Charlton, an English teacher at Abraham's Bay High School and a member of the Coalition for a Better Mayaguana, said many residents are “really afraid” that VAT will significantly reduce their standard of living.

Noting the high cost of living, and “exorbitant” charges on mail boat services, which bring food and other supplies to the island, Charlton said, “As a result, the things that customers have to buy in the local convenient stores are really, really high.

“It is tough. We do not support VAT.

“We do not see how it is going to work for us because we are struggling already.”

The government has said it will introduce VAT at a rate of 15 percent in most cases and 10 percent for the hotel sector.

Huel Williamson, a retiree, said the majority of residents are struggling to get by and many of them are unemployed.

Mayaguana has fewer than 300 residents, according to the Department of Statistics.

It is unclear what the unemployment rate is on the island.

“The economic situation here in Mayaguana is stagnant, very stagnant,” Williamson said.

“The I-Group wants to employ approximately 80 people, but right now they have a very limited number of people [on the project].”

According to I-Group officials, around 30 Bahamians are employed on the airport redevelopment project.

Asked whether residents have been adequately informed about VAT, Charlton said, “The way they had the forums for the (gambling) referendum, and the constitutional forums, something like that is needed...because a lot of people are clueless.”

Williamson said residents have been expecting government officials to visit the island to explain VAT, but that has not happened as yet.

Johnie-Mae Colebrooke, a mother of two and business owner in Andros, also expressed concern about VAT.  She said many residents are challenged to provide for their families.

“I feel very bad because I am a business woman, me and my husband George Colebrooke,” she said.

“We are praying for something to move in Andros where everyone can work because we have a lot of bills and there are no jobs.”

Minister of State for Finance Michael Halkitis said the government will cover all Family Islands before July 1, having already visited Grand Bahama, Abaco and Andros.

Mount Moriah MP Arnold Forbes said in a recent interview that on average nine out of every 10 people in his New Providence constituency do not understand VAT.

He said the government must get its education campaign to the “grassroots people”, something government officials have said they are in the process of doing.

“We will have the business owners who will have their say, but it is really the regular guy on the street, who is in the majority, that I believe we need to educate them on this in a major way,” Forbes said.

On Wednesday, Prime Minister Perry Christie said he can still be persuaded by the private sector to introduce an alternative tax model if it proves to be viable.

Christie also said the Ministry of Finance is in an “advanced” stage of preparation for VAT and is moving ahead with its implementation.

February 17, 2014