By AVA TURNQUEST
Tribune Staff Reporter
aturnquest@tirbunemedia.net
OPPOSITION leader Hubert Minnis yesterday warned that the premature implementation of Value-Added Tax could engender widespread social ills — increased poverty and an underground economy.
Pointing to the inevitable rise in food costs, Dr Minnis argued that the new
system also threatened to overwhelm the health sector as more people are priced out of a nutritional diet.
“A black market would be established, which has been clearly demonstrated in islands like St Kitts, which means you see more vendors on the side of the street selling products trying to decrease cost,” he said.
“As we have more vendors what happens is you develop what you would call shanty town vendors on the side of the streets, and in many instances these are illegal individuals so we are creating another problem that the government cannot, would not address.”
Dr Minnis called on the government to explain whether there would be a bid to address the mandatory 15 per cent gratuity tax at restaurants in place of the 10 per cent VAT.
“”This is a government that states that they love culture.” said Dr Minnis. “What would it do to the small Junkanoo man out there? The average Junkanooer spends about $1,000 of his or her money to perform every Christmas, the decorations will now go up. The government has not mentioned what would happen to the cultural component.”
He appealed to the government to push back the new system’s implementation. He said there was still too much uncertainty over the new tax structure.
Dr Minnis added that town meetings have been an inadequate method of informing the public as officials did not yet have all the answers on the direct impact to businesses and consumers.
“It’s a learning curve, auditing, accounting, all of these must be put in place. Extra cost to the business sector invariably would be passed on to you and I, the consumer,” Dr Minnis said.
“Who would be affected most? It’s usually the poor, who we should be protecting and looking out for, the middle class, whom we know is decreasing as a result of the policies this government has introduced, and we know the poverty level has increased as a result of their policies.”
He added: “How can you inform a community about a product, a new system, when you cannot answer many of the questions that came forth?”
Yesterday marked Dr Minnis’ return to parliament after he was named and suspended by Dr Major for refusing to withdraw “offensive” comments ahead of the continued debate on the Stem Cell Research and Therapy Act 2013.
Dr Minnis said history will be the judge of what occurred during the August parliamentary session.
Dr Minnis said: “These are issues that are in the minds of Bahamian people, they want to know what’s happening with the cost of living. They want know what are the issues with VAT. They want to know what programmes, what is the legislative agenda to try and create opportunities and ownership for Bahamians.”
He added: “I’m continuously hearing about Baha Mar, what do we own there? I’m continuously hearing about Bimini, what do we own there?”
Comments
John 10 years, 6 months ago
The VAT should have been phased in. Maybe the service part of I first, then tax on goods 99-12 months later. This would have lessened the shock on the economy and also allowed government to maintain control of customs duties while any unforeseen problems or shortfalls with the VAT arises. The problem with the Bahamas is that it needs to move from a briefcase economy to one that empowers Bahamians to have significant ownership in major businesses. Too many of the bank and tourist oriented businesses bag up their profits at the end of the accounting cycle and export them out of the country. The money does not remain here to generate new wealth. In addition the government spends enormous sums of its own monies promoting the tourist industry. Add this to the number of foreigners we have working in this country, legally and illegally, who take most of their earnings out of the Bahamas. And the number of Bahamians who have left the Bahamas, for college and other reasons, and are being subsidsed by families here. So the tax burden, even for infrastructure that cater primarily to the tourist industry is falling on the shoulders of small group of Bahamians who are being taxed out of existence. Rather than seeing benefits of a growing economy, they find themselves having to pay for it. They are becoming disillousioned as their beach rights are being taken away, their rights to free movement around the country is being restricted, and their cost of living is based on the cost of 'tourists living in Paradise." They will revolt!
Sign in to comment
Or login with:
OpenID