The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

and By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

The Government last night said it had received 4,417 Value-Added Tax (VAT) registration applications with just hours to go before deadline, amid private sector predictions that between 70-75 per cent of mandatory registrants would be in compliance.

The Ministry of Finance said in a statement that it expected 4,000 of those applicants to be processed as VAT registrants.

It added that the remainder may potentially qualifying for tax identification numbers (TINs) as either small businesses doing business with the Government or entities eligible for VAT refunds under the Act.

“We’re going to be well above 4,000 in terms of applications,” John Rolle, the Ministry of Finance’s financial secretary, told Tribune Business earlier in the evening.

Emphasising that the Government had seen a “strong” inflow of applications all last week, continuing into the weekend, Mr Rolle said the VAT Department now had two priorities.

Apart from sifting through the applications and confirmed registrant list to determine which companies had missed the November 30 deadline, Mr Rolle said the Department would also be moving to provide companies with their VAT registration certificates and TINs.

The Ministry of Finance last night dangled the carrot of fines being reduced, “or even waived altogether”, for businesses with annual turnovers of $100,000 and more, who had missed the November 30 deadline but got their applications in within the next few weeks.

“The VAT Department will be issuing warnings and imposing fines during a transitional period following the registration deadline of November 30, 2014,” the Ministry of Finance said.

“The fines for late registration will depend on the delay following the deadline, the size of the business, and whether the application is submitted voluntarily or as a result of prompting by the VAT Department.

“Businesses that register late, but on their own volition, may be issued a warning or fined an amount of up to $10,000. Businesses that register as a result of direct contact by the VAT Department may be issued a warning or face stricter fines up to $20,000.”

Gowon Bowe, the Bahamas Chamber of Commerce and Employers Confederation (BCCEC) chairman, had earlier told Tribune Business the Government will likely see 70-75 per cent of all mandatory Value-Added Tax (VAT) registrants signed up by last night.

He said “cooler heads have prevailed” despite ongoing reservations within the business community about VAT.

Mr Bowe told Tribune Business that while the Government had initially indicated it was expecting some 4,000 mandatory VAT registrants, only 70-75 per cent of that number would likely be realised when the process was completed.

Noting reports last week which said that 2,500 businesses had registered, Mr Bowe said many companies were deciding to finally register despite reservations.

“I think what you are finding is that businesses are now taking the position that at the very least they would register. They would continue to agitate and lobby for things that need to be corrected. My suspicion is that you are going to get 70-75 per cent of businesses that will be in by the end of Sunday evening,” said Mr Bowe.

“I think there is going to be, if you will, a concession that businesses who haven’t registered can continue to do so this week. If you missed it last week you certainly should do so this week, and not sit and continue to be defiant.

“I think you should register because at least you would have a registration number, a TIN and going forward you are 90 per cent of the way through what you need to do in order to start charging VAT, whether or not you have uncertainty on how you will do it. I think businesses have, if you will, let cooler heads prevail even if they are still not satisfied that all is well.”

Mr Bowe added: “The Business License aspect, I know that has been accommodating. The key behind that is I think it will give a greater level of clarity for the VAT unit and businesses.

“I think that there is going to be quite a positive side effect of the rush for registration, and I think we are not going to get 100 per cent. At the end of the day, I think there is a large number of business that still have registered.

“I don’t know how many of those who have registered are mandatory registrants because I know that I have spoken to several who are under the $100,000 mark and have registered. Hopefully, when we see the statistics we will see that a significant percentage have registered.”