The Tribune

By NATARIO McKENZIE

Business Reporter

nmckenzie@tribunemedia.net

BAHAMIAN auto dealers are still pushing for 11th hour Value-Added Tax (VAT) concessions, with the sector still raising numerous unresolved issues just two weeks prior to implementation.

Ben Albury, Bahamas Bus and Truck’s general manager, said the Bahamas Motor Dealers Association (BMDA) had proposed that Excise Tax be paid once a vehicle was sold and left a dealer’s lot, rather than at the border.

“We have expressed to the Government, and are still in some sort of discussions, still pleading with them on some of the lingering questions and small concessions that can be made,” said Mr Albury.

“There were a number of things. Once of them was to make, as they have in Barbados, the dealerships bonded so that we pay the VAT upon the sale of the vehicle.”

He added: “Successive administrations have changed the duty structure while in power. The last change was made with trucks. Under the FNM it was 85 per cent. When the PLP came they dropped it to 65 per cent, and that was done with no forewarning.

“What happened was all the vehicles that I had on my lot that had to stay at 85 per cent duty on are now worth substantially less, because if I were to bring it in today I would be paying 65 per cent duty.”

Mr Albury added that Business Licenses were also an issue auto dealers hopedto have addressed. “We are also looking at Business License taxes, which are still very high and that’s based on the gross turnover of the business,” he explained.

“Of course, being a business like we are with selling vehicles that are expensive, you can sell $1 million worth of vehicles but you may not have made any profit. I think we need to look at that being applied to our net profit and not on our gross margin.

“We are also looking at some flexibility in price control because we are not going to be able to increase any of our margins to cover any of our additional operating costs. We have questions still as it relates to parts inventory write-off, trade-in vehicles, warranty repairs, demo vehicles, how are all off these things going to be affected upon the implementation? We are concerned about the high cost of electricity, as are a lot of people are. If you sell 100 cars or 20 cars you still have to pay for electricity.”