Experts say there should be no V.A.T. until April 2015

Pictured are John Shewan, Adjunct Professor of Accounting, and Don Brash, of Brash Consultancy Service.

As of Wednesday, April 30, 2014

By SANCHESKA BROWN

Tribune Staff Reporter

sbrown@tribunemedia.net

THE IMPLEMENTATION of a Value Added Tax should be delayed to April 1, 2015, New Zealand VAT tax expert Dr Don Brash said yesterday.

In an interview with The Tribune, Dr Brash said while the news of the government moving away from the proposed July 1 start date is welcoming, any attempt to introduce VAT this year will be “very, very challenging.”

Dr Brash is one of two New Zealand tax experts in the Bahamas to assess and provide a report to the government on its VAT implementation readiness.

He suggested the government delay the implementation of VAT in order to properly educate the public on the new tax as well as give the government more time to put the “necessary framework” in place to assure accountability.

“I think even an October 1st date would be very, very challenging for both the public sector and the private sector. The public sector in some respects is actually a little bit more ready for this tax than I suspect the private sector is and because there has been no substantial education programme put in place so far,” he said.

“They need to have the framework in place that provides accountability for the public sector. In New Zealand, we put in place a Fiscal Responsibility Act. It did not actually limit what the government did, but it required a very high degree of transparency and a very high degree of the government being required to reveal what they were doing as well as the long term implications of what they were doing and we moved from a 30-year period of deficit to surpluses from the early 90s.

“I think realistically probably the Bahamas needs to think about January 1st or maybe even April 1st (2015). It’s more important to get it right than to get it started three months too soon. We have heard people say the rating agencies this and the rating agencies that but the rating agencies I suspect won’t care about a three-month slippage or a six-months slippage provided that they can see the government is serious about gathering more revenue.”

On Monday State Minister for Finance Michael Halkitis told The Nassau Guardian that if VAT comes on stream this year it would not be until the last quarter.

Prime Minister Perry Christie has also hinted that VAT may be delayed if the government is convinced the public is not properly educated about it.

B_I_D___ 9 years, 12 months ago

While I am still against VAT, until proven otherwise of it's merits...at least these guys have some sense in timelines. Sadly, we will come up on April 2015 and people will still be in the dark about how VAT fully operates, simply because our government...and the FNM were no better, are DEPLORABLE with educating the public about these issues. To date there has been NO input from the VAT team to the businesses that will be impacted on samples of forms, samples of reporting that will be needed, information about how the data will be shared, as it is meant to be electronic...all this stuff takes time from the systems side in the businesses to get set up with the software vendors...and if the original timeline were to hold true, we are 2 months out. I can't design, implement and test a system in house here, and make it 100% stable in tying into the government run system in 2 months, you are out of your head. Government needs to be going around to each and every business that will be impacted by this, and evaluate what their systems are capable of and offer up the details and information necessary to make sure the two can connect electronically properly. So far NOTHING. Each business is different, I run different systems and software than the guy across the street, how I handle the connects is not just some generic 'this is how it is going to work' mindset. Will be a custom set up in each and every store. They fail to realize this.

BahamianAway 9 years, 12 months ago

The whole idea of VAT is ridiculous when we have so many other avenues that could generate substantial income for The Bahamas.

Furthermore, there as been absolutely no outline as to how the government plans to decrease spending. Just keep pushing for more money to be placed in the coffers but Bahamians have no idea where it's going.

I think that the government should release the budget to Bahamians for viewing. Other Caribbean countries do it...why aren't we. So we can see what our government is spending our money on....maybe this might cut back on some of the unnecessary spending. Especially if a government feels it's reelection opportunities would be at stake.

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