Bahamians Under Pressure
By IANTHIA SMITH:
From as little as shelling out more money at an Automatic Teller Machine (ATM) to as high as coughing up additional thousands of dollars in stamp taxes on a dwelling home or property, beginning today, Bahamians will have to put a tighter squeeze on their wallets to keep their heads above water.
Today marks the start of the 2010/2011 fiscal period, a 12-month roadmap that ushers in a rash of budget cuts, higher taxes, a freeze on hiring and promotions and in some cases, salary decreases.
But despite the firestorm of criticism that has followed the $1.8 billion budget since its introduction in Parliament several weeks ago, Prime Minister Hubert Ingraham has maintained that it is the best the government could have done under the present economic climate.
However, the Progressive Liberal Party (PLP) would tell you an entirely different story.
The Opposition argues that a part from the global economic downturn, the government’s poor fiscal management has much to do with what the country is now up against – mounting expenses and little revenue.
"This is one of the worse (budgets) for all Bahamians. The budget communication does nothing to critically address this critical and urgent need which continues to have far reaching economic, social behavioural consequences for the people of The Bahamas," Opposition Leader Perry Christie told members of the media at the time.
"This is a tax and pain budget. It is the prime minister singing a sad story as he describes the problems, but without any ideas about how to grow us out of this crisis and without accepting any responsibility for the state we are in under his stewardship."
But according to Prime Minister Ingraham, in order to bring relief to the country, the government had to make some tough decisions and the majority of those decisions come into play today.
These include stamp tax on realty transactions that have been increased by two percentage points. Stamp tax on bank transactions have been hiked by 15 cents and the air and sea departure taxes have jumped by $5.
In the case of cruise ships, the increase takes effect October 1.
Starting today, hotel room taxes will jump by 10 per cent of the room rate, while the annual fees payable by retail banks have increased by a whopping 50 per cent.
Car licensing fees, the rates on spirit and beer manufacturing and fees under the International Business Companies Act also went up.
If all went as planned, New Providence residents would have also had to shell out money for garbage collection services beginning today.
However, negotiations for the privatisation of solid waste management stalled.
With the increase in taxes, came dips in salaries and ministerial portfolios.
Freezes were even placed on hiring and promotions in the public sector, except for essential services, like police and defence force officers, teachers and nurses.
Budget allocations for the majority of ministries and departments took a nosedive.
The government has allocated some $1.55 billion for recurrent expenditure and more than $265 million for capital expenditure.
But as bad as it might seem, the Ingraham administration is not alone in trying to restore the country’s ravaged public finances over the next 12 months.
Countries like the United States, Germany and Britain have also made drastic cuts across the board.
In an "emergency budget" Britain’s Treasury chief George Osbourne unveiled "the toughest cuts to public spending in decades, which saw welfare payments and spending programmes slashed.
Mr. Osbourne said the austerity package was necessary to make "quick cuts to crippling national debts racked up during the global financial crisis.
July 1st, 2010
jonesbahamas
A political blog about Bahamian politics in The Bahamas, Bahamian Politicans - and the entire Bahamas political lot. Bahamian Blogger Dennis Dames keeps you updated on the political news and views throughout the islands of The Bahamas without fear or favor. Bahamian Politicians and the Bahamian Political Arena: Updates one Post at a time on Bahamas Politics and Bahamas Politicans; and their local, regional and international policies and perspectives.
Showing posts with label Bahamas 2010/2011 Budget. Show all posts
Showing posts with label Bahamas 2010/2011 Budget. Show all posts
Sunday, July 4, 2010
Thursday, July 1, 2010
Zhivargo Laing - State Minister for Finance says the government presented a budget (2010/2011) that's designed to cope with a crisis if it occurs
Laing: Budget Prepares For The Future
By Kendea Jones:
More than a month after the Ingraham administration presented its 2010/2011 Budget, State Minister for Finance Zhivargo Laing is still fighting off a firestorm of criticisms, claiming that the government made the best move for the country. The new fiscal plan, which takes effect on Thursday, has a rash of cuts and tax increases.
For instance, come July 1, the government will introduce a 65 per cent rate for cars that are 2,000 ccs or fewer, a 75 per cent rate for cars between 2,000 and 2,500 and an 85 per cent rate for all other cars, except hybrids, which face the lower duty of 25 per cent.
According to Prime Minister Hubert Ingraham, this allows many fuel-efficient, four-cylinder vehicles to be covered under a rate of duty that is mid-way between the low and high rates.
"I think there were some adjustments made for the timing of when the cars will come in and some provisions made for persons who would have imported vehicles between the 26th June and July 1 when those rates take effect," Minister Laing explained.
"Commercial credits will be granted to auto dealers and a refund to individuals who would have imported vehicles during that period."
But according to the state minister, not only did the government present a budget that would sustain the country for the next 12 months but beyond that timeframe.
"The reality is that we presented the budget we did so that we could put ourselves in a position where we could cope with a crisis if it occurs," he said.
"We didn’t want to grow the debt in the midst of the crisis. So, we are looking to claw back some of the damage and put ourselves in the position that if a hurricane damages The Bahamas, we would be able to respond. If there is a crisis we would be able to do what is necessary to respond to it."
Minister Laing also again dispelled the notion that the government is broke as "ludicrous."
"The government couldn’t pay salaries if it did not have money. This is a question of putting the fiscal house in the position that you are able to operate in a sustainable manner; meaning that you are not doing something that is going to cause you to be unable to maneuver," he said.
"We are not doing something that is going to cause such a heavy load on future generations. The government is not going to spend widely today, as if there is no tomorrow. Anything can happen tomorrow."
The 2010/2011 Budget allocates some $1.55 billion for recurrent expenditure and more than $265 million for capital expenditure.
Government debt at the end of June 2011 is projected to stand at 49.2 percent of GDP, up from 47.3 percent a year earlier.
June 30th, 2010
jonesbahamas
By Kendea Jones:
More than a month after the Ingraham administration presented its 2010/2011 Budget, State Minister for Finance Zhivargo Laing is still fighting off a firestorm of criticisms, claiming that the government made the best move for the country. The new fiscal plan, which takes effect on Thursday, has a rash of cuts and tax increases.
For instance, come July 1, the government will introduce a 65 per cent rate for cars that are 2,000 ccs or fewer, a 75 per cent rate for cars between 2,000 and 2,500 and an 85 per cent rate for all other cars, except hybrids, which face the lower duty of 25 per cent.
According to Prime Minister Hubert Ingraham, this allows many fuel-efficient, four-cylinder vehicles to be covered under a rate of duty that is mid-way between the low and high rates.
"I think there were some adjustments made for the timing of when the cars will come in and some provisions made for persons who would have imported vehicles between the 26th June and July 1 when those rates take effect," Minister Laing explained.
"Commercial credits will be granted to auto dealers and a refund to individuals who would have imported vehicles during that period."
But according to the state minister, not only did the government present a budget that would sustain the country for the next 12 months but beyond that timeframe.
"The reality is that we presented the budget we did so that we could put ourselves in a position where we could cope with a crisis if it occurs," he said.
"We didn’t want to grow the debt in the midst of the crisis. So, we are looking to claw back some of the damage and put ourselves in the position that if a hurricane damages The Bahamas, we would be able to respond. If there is a crisis we would be able to do what is necessary to respond to it."
Minister Laing also again dispelled the notion that the government is broke as "ludicrous."
"The government couldn’t pay salaries if it did not have money. This is a question of putting the fiscal house in the position that you are able to operate in a sustainable manner; meaning that you are not doing something that is going to cause you to be unable to maneuver," he said.
"We are not doing something that is going to cause such a heavy load on future generations. The government is not going to spend widely today, as if there is no tomorrow. Anything can happen tomorrow."
The 2010/2011 Budget allocates some $1.55 billion for recurrent expenditure and more than $265 million for capital expenditure.
Government debt at the end of June 2011 is projected to stand at 49.2 percent of GDP, up from 47.3 percent a year earlier.
June 30th, 2010
jonesbahamas
Friday, June 11, 2010
Zhivargo Laing: The Bahamas' best interest is worth the Free National Movement's (FNM's) political life
Laing: Nation's best interest worth FNM's political life
By KRYSTEL ROLLE ~ Guardian Staff Reporter ~ krystel@nasguard.com:
The austerity measures the government is proposing in the 2010/2011 budget were borne out of absolute necessity, Minister of State for Finance Zhivargo Laing said yesterday while contributing to debate on the new spending plan in the House of Assembly.
Over the past year and a half, the government has borrowed and spent millions of dollars to fund various initiatives in response to the economic downturn.
As a result, the national debt is nearing $4 billion.
But Laing said now that the economy is modestly rebounding, it is time for the government to try to right the country's finances.
He acknowledged that the measures that the government is taking could lead to some political fallout. Nonetheless, he said it is something that had to be done.
"To do the necessary is sometimes unpleasant, but always correct and always rewarding," he said.
"If sometimes you have to spell your political death, then march toward it. The truth is that this nation's best interest is worth our political life. We labored over many months, many hours to produce this budget. It is a challenging budget."
However, he added that it is "loaded with adequate provisions for every government ministry while all around the world civil servants are losing their jobs. We made provisions for every single civil servant to stay and they have seen not cuts in their salaries."
The government is seeking to increase the stamp tax on realty transaction, stamp tax on banks, hotel room tax, air and sea departure tax, vehicle tax, and the beer tax.
Additionally, all parliamentarians, including Prime Minister Hubert Ingraham, will take a pay cut.
Other cost-saving measures are proposed, including a stall on increments for public officers. Public service promotions are being frozen, except in special cases and public service employment is being frozen, except in extenuating circumstances, such as essential services.
Laing said there is no other way to enhance revenue but to increase taxes.
"The point is we should have a debate one day about this fundamental adjustment that we need to make to our circumstances, but over the next 12 months, we have to get revenue. We have to produce the revenue in a way that does not injure the people of the Bahamas," he said.
Laing said the country must begin to reduce the deficit and eventually begin lowering its debt to GDP.
Ingraham recently said the government debt at the end of June 2011 is projected to stand at 49.2 percent of GDP, up from 47.3 percent a year earlier.
Laing said the budget has long term implications that bode well for the country's future sustainability.
"For the next 12 months we have to attend to the business of the Commonwealth of The Bahamas. All of us are being called upon to act in a way to best assist the Commonwealth of The Bahamas to be better off financially," he added.
Laing noted that in some other countries public servants are being sent home.
He added that the majority of the taxes are levied at international sources and banks and not at the average Bahamian.
Laing also said the government is focused on its mission and vision for the country to have a dynamic and growing middle class, a level of saving for retirement, high levels of success for entrepreneurs and a modest level of taxation.
"That remains our vision and mission," he said.
"Our effort in this 2010/11 budget is geared towards putting us in a better position to fulfill that vision and mission."
June 10, 2010
thenassauguardian
By KRYSTEL ROLLE ~ Guardian Staff Reporter ~ krystel@nasguard.com:
The austerity measures the government is proposing in the 2010/2011 budget were borne out of absolute necessity, Minister of State for Finance Zhivargo Laing said yesterday while contributing to debate on the new spending plan in the House of Assembly.
Over the past year and a half, the government has borrowed and spent millions of dollars to fund various initiatives in response to the economic downturn.
As a result, the national debt is nearing $4 billion.
But Laing said now that the economy is modestly rebounding, it is time for the government to try to right the country's finances.
He acknowledged that the measures that the government is taking could lead to some political fallout. Nonetheless, he said it is something that had to be done.
"To do the necessary is sometimes unpleasant, but always correct and always rewarding," he said.
"If sometimes you have to spell your political death, then march toward it. The truth is that this nation's best interest is worth our political life. We labored over many months, many hours to produce this budget. It is a challenging budget."
However, he added that it is "loaded with adequate provisions for every government ministry while all around the world civil servants are losing their jobs. We made provisions for every single civil servant to stay and they have seen not cuts in their salaries."
The government is seeking to increase the stamp tax on realty transaction, stamp tax on banks, hotel room tax, air and sea departure tax, vehicle tax, and the beer tax.
Additionally, all parliamentarians, including Prime Minister Hubert Ingraham, will take a pay cut.
Other cost-saving measures are proposed, including a stall on increments for public officers. Public service promotions are being frozen, except in special cases and public service employment is being frozen, except in extenuating circumstances, such as essential services.
Laing said there is no other way to enhance revenue but to increase taxes.
"The point is we should have a debate one day about this fundamental adjustment that we need to make to our circumstances, but over the next 12 months, we have to get revenue. We have to produce the revenue in a way that does not injure the people of the Bahamas," he said.
Laing said the country must begin to reduce the deficit and eventually begin lowering its debt to GDP.
Ingraham recently said the government debt at the end of June 2011 is projected to stand at 49.2 percent of GDP, up from 47.3 percent a year earlier.
Laing said the budget has long term implications that bode well for the country's future sustainability.
"For the next 12 months we have to attend to the business of the Commonwealth of The Bahamas. All of us are being called upon to act in a way to best assist the Commonwealth of The Bahamas to be better off financially," he added.
Laing noted that in some other countries public servants are being sent home.
He added that the majority of the taxes are levied at international sources and banks and not at the average Bahamian.
Laing also said the government is focused on its mission and vision for the country to have a dynamic and growing middle class, a level of saving for retirement, high levels of success for entrepreneurs and a modest level of taxation.
"That remains our vision and mission," he said.
"Our effort in this 2010/11 budget is geared towards putting us in a better position to fulfill that vision and mission."
June 10, 2010
thenassauguardian
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