The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Government yesterday said it was preparing to “use all the tools in our arsenal” to drive Value-Added Tax (VAT) registration, with just 7.5 per cent of the estimated 4,000 mandatory registrants having submitted applications to-date.

John Rolle, the Ministry of Finance’s financial secretary, told Tribune Business that around 300 VAT registration applications had been submitted in the two-and-a-half weeks since the process was launched.

With exactly one month left for all mandatory VAT-collecting businesses to complete the registration process, Mr Rolle said the Government was “bound to honour the law” when asked if it would impose the sanctions at its disposal.

Suggesting that it would be unfair to compliant companies not to penalise those who failed to abide by the law, Mr Rolle said he expected registration numbers to increase as the Government’s November 30 deadline neared.

The Christie administration plans to publish the list of all VAT registrants next week, and Mr Rolle said the system would be able to cope with both a last-minute rush and numbers greater than the projected 4,000.

And he expressed no concern about the Government potentially missing the end-November deadline to complete registration, as some in the private sector fear.

“The absolute numbers in terms of the applications that have been submitted are about 300,” Mr Rolle told Tribune Business, “and in terms of large companies we’re seeing encouraging trends. We’re going to publish the list of registrants next week.”

The Financial Secretary added that visits to businesses by the VAT Unit had shown many were readying to submit their applications, and he promised that the drive to encourage registration would only intensify.

“That’s where we are right now,” he said. “It’s difficult to project the number of businesses coming in. What we see and anticipate is that there is some delayed response going on.

“We expect the momentum is going to increase, so we will align resources to the place where the traffic will accelerate. We are encouraging businesses to get the process done as quickly as possible.

“We’re going to use all the tools at our disposal,” Mr Rolle added, when asked if the Government would ‘get tough’ to encourage registration. “We’re going to be bound to honour the spirit of the law.”

The Government has focused its efforts on large companies, as these will be the biggest collectors/remitters of VAT, and Mr Rolle said “a good number” of such firms were included in the first 300 applications. He estimated large companies accounted for around 25 per cent of submitted applications.

Edison Sumner, the VAT Education Task Force’s co-chair, last week suggested that the Government would miss the November 30 deadline for completing the VAT registration process, with this carrying on past the January 1, 2015, implementation deadline.

And he also suggested that the number of VAT registrants could likely ‘double’ beyond the Government’s projected 4,000 to hit 8,000, especially as some businesses not on the Business Registry - such as doctors - will have to collect/remit the new tax.

Mr Rolle tacitly conceded that the Government might receive more than the anticipated 4,000 mandatory VAT registrants, but added that the administration was “prepared, should that happen, to deal with it”.

He conceded, though, that the Government had based its estimates on the Business Licence registry, which did no contain all businesses operating in the Bahamas.

Still, Mr Rolle said the online nature of the VAT registration system, and its ability to receive applications 24/7, meant it was well-equipped to deal with a last-minute rush.

“It’s not a queuing process,” Mr Rolle told Tribune Business. “It’s not like we’re standing at a ticket booth and receiving applications one-by-one.

“We have a system where any minute, any hour, it can simultaneously receive hundreds of applications. If they come, our system can handle them.”