The Tribune

By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

A Bahamian contractor said yesterday that levying 7.5 per cent Value-Added Tax (VAT) on the sector without first passing the Contractors Bill would be a “recipe for disaster”, telling Tribune Business: “We are in no manner, shape or form prepared for this.”

Stephen Wrinkle, the Bahamian Contractor’s Association’s (BCA) immediate past president, said that if the Government did not move to pass the long-awaited legislation to regulate the industry, it would never realise its revenue projections.

“Unless and until they pass that Contractor’s Bill, where we can license and regulate the industry, they are never going to collect the kind of funds they hope to collect from the industry,” said Mr Wrinkle.

“They can’t control who is in the business and what they are doing. A lot of these guys operate without a Business License anyway. It’s going to be extremely difficult to monitor the industry without controls and regulations in place; they can’t do it now.”

Mr Wrinkle expressed disappointment that the BCA was not consulted prior to the Government releasing its Tariff and Excise Tax rate changes.

“A lot of materials within the construction industry that they are talking about either reducing or changing the duty rate on are, in some places, ambiguous,” said Mr Wrinkle.

“There is some duplication of stuff. It’s a shame that the BCA was not consulted prior to issuing all these particulars. We were never consulted about what should and should be included in the list of reduced items. There is a lot of room for error, a lot of interpretation is needed to clearly specify these items and how they pertain to us, and clearly a need for consultation with the industry as a whole.”

Mr Wrinkle said that 95 per cent of Bahamian contractors who run small/medium-sized operations were “field oriented” and not accustomed to the paperwork and accounting systems required to comply with VAT.

“We are in no manner, shape or form prepared for this. You are trying to get 95 per cent of contractors involved in a programme where we don’t have any licensing, regulation or controls existing, and it’s a recipe for disaster,” said Mr Wrinkle.

“The present form of VAT, as it is constructe with regards to the construction industry, is going to be extremely difficult to implement without having legislation to regulate the sector.”