By SANCHESKA BROWN
Tribune Staff Reporter
sbrown@tribunemedia.net
LESS than 10 per cent of businesses with an annual turnover of $100,000 have registered for value added tax ahead of the November 30 deadline, according to Michael Halkitis, State Minister for Finance.
Mr Halkitis said of the of the 4,500 businesses required to register only 295 have complied so far. With the registration deadline drawing near, Mr Halkitis said there is a slight concern that those businesses that are mandated by law to register to collect/remit VAT on the government’s behalf, may not be ready and registered until after the new tax is implemented.
“As of Wednesday, October 29, only 295 businesses have completed the registration and have their documents. There are another 138 who are still in the process who we hope will be completed in a day or two,” Mr Halkitis said.
“So right now we are encouraging businesses to go online and register, it takes about 15 minutes. We do not want people to wait until the last minute and flood us with applications because there may be some difficulty. However, we are encouraged with the amount of large businesses that have registered and we are in active discussions with a few others.
“Our deadline for registration is November 30, but businesses have until the end of the year and the beginning of next year, if it is needed to register, but we are hoping it will not come to that.”
Mr Halkitis said businesses that do not register will be “forcibly registered” by the VAT commissioner and if those businesses do not comply they will face harsh penalties.
According to VAT regulations, a taxable person that fails to register, faces a maximum fine of $100,000 plus a year in prison.
The regulations also allow a fine of up to $50,000 or a prison term of up to two years for wilfully evading VAT.
Businesses earning more than $100,000 a year will still be required to register their business.
There will be three filing periods for VAT however, businesses that earn more than $5 million will be required to file monthly.
Businesses will be granted up to 28 days to file their returns after their deadlines.
Mr Halkitis said a taskforce will lead a full-fledged educational campaign beginning next month on VAT with an allocated budget of $150,000.
VAT will be implemented on January 1, 2015 at a rate of 7.5 per cent.
Comments
GrassRoot 9 years, 5 months ago
are we surprised? the deadlines were too tight. now the following may happen: business miss the deadline (time, system down etc.), get fined, will fight the fines in court etc. This ship has been sinking a long time ago.
The_Oracle 9 years, 5 months ago
This ship sunk on dry land! If launched it is going straight to bottom!
observer2 9 years, 5 months ago
I think businesses maybe too afraid to register due to the extremely intrusive level of banking information required. As I understand it the information required to register includes:
"Banking Information: Bank Name, Branch Location, Account Number, Account Type, and Credit Reference Letter.
Tax registrations in the US, Canada and the UK don't require banking details...hmm. Having reference to a leading businessman's unfortunate customs valuation "error" and subsequent leak and his related resignation as head of a leading trade organization, I hope that the bank information is kept strictly confidential. Especially for those that "protest too loudly".
Coupled with the accounting impossibility of implementing VAT inclusive inventory pricing and the level of theft levels against business the fear levels must be unbearable.
VAT will not work as you can't tax the national debt away nor can you cut government spending to the extent needed to reduce the debt. See storey below on Barbados. Barbados implemented VAT in 1997 at 15% and in the face of mounting debt increased it to 17.5% in 2010 and last year in a desperate attempt to stop the debt growth they cut the civil service by 3,000 persons. Now they are at the brink of default and are in need of an IMF bailout.
http://www.bloomberg.com/news/2014-10...">http://www.bloomberg.com/news/2014-10...
VAT will lead to lower business and consumer demand, lower government taxes, a slower economy, higher unemployment rates and growth in the unrecorded economy. As I chat casually to businesses they are considering cutting staff and outsourcing functions to make up for the VAT tax and to obtain VAT input credits.
Many small businesses are marginally unprofitable and don't even know how to keep financial records. What are they to do? The level of financial illiteracy is too high for VAT.
Economic growth will only occur through trade liberalization, privatization (not government partnerships), decentralization, laissez faire economics, education, healthcare and rehabilitation/opportunities for our people. However this is impossible to implement as there are too many special socio-economic-political interest benefiting from the status quo.
ohdrap4 9 years, 5 months ago
well they also require current business licenses hahahahaha Who has current business license? only the bay st boys hahahahahaha
duppyVAT 9 years, 5 months ago
They should all BOYCOTT. That would be the best democratic protest against the government.
marrcus 9 years, 5 months ago
What if NOBODY registered? What could they do? They don't "disclose" or pay their BEC bills. Why should we accept VAT. Protest..... NOVAT NOVAT NOVAT NOVAT NOVAT NOVAT NOVAT NOVAT NOVAT NOVAT NOVAT NOVAT NOVAT NOVAT NOVAT NOVAT NOVAT NOVAT NOVAT NOVAT
can you here the chant?
GrassRoot 9 years, 5 months ago
well it may be beneficial to declare all of New Providence a prison, at least then we would have resolved the bail issue once and for all.
duppyVAT 9 years, 5 months ago
VAT is not the answer to our problems. We need to collect the outstanding taxes, close the loopholes in the existing tax system and cut back on wasteful government spending, kickbacks and crony contracts. But for that to happen we need a trustworthy government......... sigh
abacogrouper 9 years, 5 months ago
Amen to that brother.... my sentiments exactly.
GrassRoot 9 years, 5 months ago
its more interesting for a government to come up with new initiatives. Unfortunately the Bahamas political system gives an advantage to the populist politician, that talks, shows his face on TV etc. So bringing a new tax/Government initiative is more sexy than just enforcing the existing taxes. The VAT will be a mess beyond. We cant even stop the corruption at Customs or the DMV, how should we prevent stealing and corruption and mismanagement with VAT?
B_I_D___ 9 years, 5 months ago
VAT is set up so that once you submit your monthly VAT entry that the funds are automatically taken from your bank account and transferred to govt. VERY SCARY.
GrassRoot 9 years, 5 months ago
would be a good system for RPT.
proudloudandfnm 9 years, 5 months ago
DO NOT REGISTER FOR VAT! OUR ONLY CHANCE TO STOP THIS STUPID IDEA IS TO NOT COOPERATE.
DO NOT REGISTER!
duppyVAT 9 years, 5 months ago
Wonder how much da PLP paying Anthony Foster for dat TV ad about VAT? He een shame to front for dem PLP theives (maybe he is one a dem!) Dats a LIE from da pits a HELL!!!!!!!!!!!!
John 9 years, 5 months ago
This man (John Rolle) is already threatening businesses, many of whom are considering closing down before the implementation of VAT. Rather than taking such harsh and hostile posture against these businesses that are to become mandatory and unpaid revenue collection agents for the government, John Rolle should try convincing his bosses to give incentives to early registrants. Laptops, PC's, and VAT compliant software are some suggestions. Despite his threats, John Rolle can do nothing to force companies to register until the deadline passes so his tough talk is just air. And John Rolle should also put in a requisition for a new suit!
observer2 9 years, 5 months ago
John are you sure VAT will be automatically pulled from your bank account by the government once your VAT returns are filed? That would be devastating.
I think you may have a point. Why else would they want such detailed banking information just to register for VAT?
SP 9 years, 5 months ago
I am NOT paying for a new suit for John Rolle! He dressed like a clown until now and he can continue doing so!
John 9 years, 5 months ago
NOT ONLY WILL VAT automatically deduct VAT taxes from your bank account, but it will do a search of ALL government agencies to see if you have any other outstanding taxes, real property tax, business license, national insurance, dowdswell street *hooker tax, and it will deduct all these from whatever credits the government has for you...ok im not sure about child support payments and alimony
Thinker 9 years, 5 months ago
The Ultimate Mafia is the Bahamian Government. The sleeping giant of tyrannical dictatorship has been awakened.
The_Oracle 9 years, 5 months ago
Vat is nothing but an effective data collection system for income tax. The data is needed to assess all assets and income for income tax, and there will be no hiding foreign assets via the TIEA signed with other countries of choice. All of this represents an outright Confiscation of Money from those with any left, by the Government who wants it all, and will take it all at the point of a Government Gun. Criminals have the guns, Government has the guns, Who is left without? The few honest bill paying weight carrying behind bars residing citizens. The Banking info is needed for direct attachment/confiscation of any cash in the bank, while you try to argue with the Sheriff of Nottingham. (John Rolle) Cesar is busy fiddling while Rome Burns.(Christie) To hell with your bills, the governmet needs to pay theirs, No different from the Officers Son who started dealing in drugs to pay the mortgage. The ends Justifies the means.
observer2 9 years, 5 months ago
Good point Oracle. I guess businesses who have the ability will get their money out before they give the government their bank account info.
asiseeit 9 years, 5 months ago
I wonder what they could do if ALL business REFUSED to pay VAT? The people rule, they could do nothing! Government will waste, squander, and steal our tax dollars and the people will get NO return on their investment (tax) dollars as usual. A simple fact in the Bahamas is that the only entity to benefit from Bahamians paying tax is the government itself, the people get squat! Are you safe? Do you have reliable services (water, electric, telephone, roads, health)? Is your quality of life good? Most, if not all, Bahamians would say NO, therefore Mr. Government man you are a failure and need to GO!
duppyVAT 9 years, 5 months ago
Think about what Carnival, Bahamas Bowl, Stellar Waste, Bimini Bay, BEC, RBDF project,Shock treatment, High School Diploma, Bahamasair, BOB, BAIC/BAMSI, UB, UR2.0 etc will further cost us with very little to show for it at the end of the day. Lots of show and tell with little benefit to show for it. Thats the Perry & his PLP way.
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