By NATARIO McKENZIE
Tribune Business Reporter
The gaming industry will feel the impact of Value-Added Tax (VAT) in addition to whatever industry-specific structure the Government decides to impose, a senior Ministry of Finance official says.
The revised 7.5 per cent VAT Bill lists “games of chance, gambling and lotteries”, which fall under the existing Lotteries and Gaming Act, as activities where the new tax will not be levied on end consumers.
John Rolle, the financial secretary, explained that while gaming will not be subject to VAT, there will be a tax on the industry.
“There is no proposal for a VAT on gaming, but there will be tax on the gaming industry. It’s not that gaming will be exempt from taxation. In most countries, if not all countries that have VAT in place, the gaming or gambling side is approached from a different angle,” said Mr Rolle during a a recent Ministry of Finance VAT/Tariff working aession.
Mr Rolle added: “There will be a tax regime for gaming. Understand, though, that if business activity is exempt from VAT, as far as that is concerned any VAT that those activities encounter is a direct cost for which the question of a VAT credit does not come up. That doesn’t mean that they won’t feel the VAT, and they will encounter whatever tax the government sets.”
Edison Sumner, the Bahamas Chamber of Commerce and Employers Confederation’s (BCCEC) chief executive, last week called on the Government to “give further consideration” to making web shop gaming Value-Added Tax (VAT) ‘exempt’.
He indicated that companies in other sectors feel the Government is unfairly discriminating in favour of web shops with this policy.
Tribune Business understands that the Christie administration has decided gaming - both the casino and web shop variety - should be treated as VAT ‘exempt’ because the sector is already taxed under its own special structure.
Mr Sumner, though, said this was no excuse for making web shop gaming ‘exempt’, pointing to numerous other businesses and sectors that will have to pay taxes under their own special structures as well as VAT.
Mr Sumner said the new VAT Bill’s ‘games of chance’ definition, in his opinion, included web shops within its ambit. Last week, Prime Minister Perry Christie indicated that the Government had completed a substantial part of its work on the gaming legislation with “a little dressing up” left to be done before it is brought to Parliament.