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'We Are Closing Because Of Vat'

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A well-known businessman has told his retail staff to begin looking for new jobs before the business closes by mid-2014, blasting: “We are not doing VAT.”

Ethric Bowe, proprietor of ATEL Outlet, said the company had already started the process of winding down its inventory levels, telling Tribune Business: “The decision has been taken. We’re not going to go any more.”

Mr Bowe said he and his wife, who runs ATEL Outlet, had “had enough”, citing general disillusionment with the overall business environment in the Bahamas and implying that VAT’s impending arrival on July 1 is the ‘straw that broke the camel’s back’.

While only three staff will be impacted, the concern for the wider Bahamian economy and society is how many other entrepreneurs are contemplating following Mr Bowe - either by shutting their businesses altogether or downsizing employee numbers.

In an e-mail sent to other members of the Bahamian private sector, Mr Bowe said VAT was merely the latest in a long string of negatives that had been heaped on businesses/entrepreneurs in recent years.

“We operate a small retail business. The general economy hit us hard. The roads hit us hard. The docks hit us hard,” he told his fellow businessmen.

“If VAT comes, we have taken the decision to close our doors. We are not doing VAT. I spoke with the employees today to inform them to look for other opportunities between now and July. We will begin winding out our inventory.

“I am sure we will find something new to do. I am thinking book-keeping might be in high demand,” Mr Bowe said jokingly.

His e-mail, though, notes the cumulative toll the 2008-2009 recession, coupled with setbacks such as the New Providence Road Improvement Project, has taken on many businesses and the confidence of their owners. This has been further exacerbated by the concerns many harbour about VAT’s likely impact on consumers and the private sector.

“It’s just not worth the effort,” Mr Bowe said of ATEL Outlet’s impending closure. “You’re working harder for less and less. My wife is key in the running of that business, but she’s had enough and is not going to go any more.

“I can’t go run it. I’m trying to do less, not more.”

Mr Bowe, who has been among VAT’s prominent critics, then lashed out at the overall business climate facing the country’s private sector.

“We’re just dragging, dragging, dragging,” he told Tribune Business. “This country could be so much better, but it seems the only way to prosper in the Bahamas is to be a criminal. They’re doing fantastically well. But try to do things the right way, and they give you the run around.”

To illustrate this, Mr Bowe recalled a recent incident where they gave a client a cheque to enable him to clear a debt to the Public Treasury. The reaction from officials was that they “can’t accept cheques, particularly our cheque”, even though Mr Bowe’s businesses had made numerous such tax payments to the Government.

“We pay by cheque all the time,” he added. “This is why they [the Government] can’t get the money. People in the Government are doing foolishness, and there’s no accountability. We had to speak to the minister responsible. It’s no good speaking to the supervisor; the phone just rings and rings.”

Mr Bowe then cited his efforts to get an apartment he owned registered with the Government’s Valuation Office for real property tax purposes.

“We can’t get it registered to pay it,” he told Tribune Business. “We want to pay. We aren’t running from anything. We are literally trying to pay it to help the country’s running, and they don’t want to take it.

“I don’t know what’s going on in this country. If I was a public servant, I’d be trying to get in as much money as possible to help pay my salary.

“It’s not the system; it’s the people. We’ve taught people not to work, but to expect to get paid. We have a system of dependency. Your MP gets you a job, and when the trough runs dry they just take more money from other people.”

Mr Bowe added: “When you look at the whole picture in the country, it’s not good. We have serious productivity problems, serious human resources problems, and no one is addressing it.

“Everything is just declining, declining, declining, and we accept it and say it’s OK. We have to keep wondering..... are we meant to suffer?”

ATEL Outlet is the successor to Mr Bowe’s Advanced Technical Enterprises business, which he started in 1994 - almost two decades ago.

Emphasising that this is his sole business interest to be impacted, Mr Bowe said of ATEL Outlet’s pending closure: “You can’’t just sit and do nothing. It doesn’t happen in an instant. You have to start winding down your inventory and not develop it.

“We’ve evolved it [ATEL Outlet]. It’s a brand. A lot of what we do has Advanced Technical Enterprises built into it. We’ve evolved the name, evolved the brand, and done a lot of things with it, so there’s a lot of attachment.

“We’ve just decided we’re not going to do that. I’m feeling tired and uninspired. We don’t have any terrible feelings about it,” Mr Bowe said.

“Before the flood, we said let’s make the decision, not let someone else make the decision for us. It’s very real and has consequences for everyone. The unfortunate thing is some of the people working for us are not very young, so it will be more difficult for them to find employment.”

Comments

proudloudandfnm 5 years, 1 month ago

Mr Bowe then cited his efforts to get an apartment he owned registered with the Government’s Valuation Office for real property tax purposes.

“We can’t get it registered to pay it,” he told Tribune Business. “We want to pay. We aren’t running from anything. We are literally trying to pay it to help the country’s running, and they don’t want to take it.

This happens way too much In our country. Why in the hell do you have to chase the government down to pay property tax?!!?

This is one of the main reasons I am adamantly opposed to VAT. They literally DO NOT COLLECT property taxes yet they tell us we NEED VAT!?!? BAHAMIANS WAKE UP AND FIGHT FOR YOUR RIGHTS. WE DO NOT NEED VAT. WE NEED TO CLEAN UP CURRENT TAXES FIRST. DEMAND THAT FROM OUR GOVERNMENT. DON'T ASK. DEMAND! THIS IS NOT ABOTU PARTY. THIS IS NOT ABOUT THE PLP OR THE FNM WINNING. THIS IS ABOUT US.

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ohdrap4 5 years, 1 month ago

the govt does not take company or personal checks, you have to get cashier checks.

of course there are problems with VAT but the govt has never taken personal checks, so he is not closing down because of that.

eeven at the post office you either pay the rental on the boxes by cash or certified checks.

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Thinker 5 years, 1 month ago

He never said he was closing for that reason. He was just making a point. Bureaucracy is the problem. I say cut government as soon as they implement this ridiculous backwards socialist regime.

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John 5 years, 1 month ago

The fact of the matter is that business has gotten W O R S E since the completion of the road works. Retail businesses especially. Not only because so much more people are unemployed, including those who worked on these road works and the airport and other government projects, and many private businesses that have folded, especially during this summer, but prices have increased and Bahamians have the fear of what will happen to their disposable income when VAT comes. But many persons are still travelling to do their Christmas shipping. Bahamasair has been booked solid for the month of December and police had to be called in to two major shipping companies, Betty K and The Mailboat, to maintain order as persons tried to clear their shipments from Miami. We still have a double economy, where some people like government workers and some private sector workers have felt NO effects of the recession. These are the ones who are still spending, but rather than support local businesses, they continue to export Bahamian dollars to Miami and the US. Part of the reason is that many Bahamian travelers pay no customs duty. One woman was overheard saying, "Chile these things in Nassau too expensive. That is why I did my shopping in Miami. ANd we ain't pay no customs duty. All the mad do is ask us what we gat, then he tell us we could go. He aint even search through our things." But local businesses are not that fortunate. they have to pay customs duty (tax) and come July they will have to pay more tax. And if the customs officers are allowing half of the population to travel and shop duty free, things will get even more expensive in the Bahamas..and even more businesses will close.

NO

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bigbadbob 5 years, 1 month ago

if the islands had to add vat to condo/ hotel rentals they would be out of business, so we figure being under the 100k is the best bet , as most don't buy much they could absorb the few percent they would be charged vat in what they buy. I expect a few things to happen a huge increase in underground economy the rise of small cash business , lots of people running with boats to Florida to buy and import with out going to customs, and a lot of companies reducing until there under 100k , either by selling less or running two cash registers one for vat one for cash in the pocket. The government needs to do more to collect outstanding debts, between NIB property tax and customs duties owed it would make a huge improvement . and big companies closing because of the extra work in accounting and collecting vat which they get zero compensation for and waiting for ever to collect there payments back. I would put a bet that most companies will wait 6 to 12 months to get a check back and it will be wrong , and they will have to waste time and money auguring over it , as we do now with most bills .

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Thinker 5 years, 1 month ago

Good tips for the newly made criminal business owners. Absolutely true.

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