The Tribune

EDITOR, The Tribune.

This letter is a formal petition to the Right Honourable Perry Gladstone Christie,

Prime Minister of The Bahamas, against the implementation of the Value-Added Tax (VAT). Please cancel your plan to introduce VAT into our economy. The impoverished, which constitutes the majority of our population, cannot handle VAT. It is economically wrong and socially wrong.

You say you are “For the people” and claim “Bahamian First.” Well consider this, sir: A businessman who lives off 10 per cent of his income imports materials for $1,000 pays 7.5 per cent VAT, then marks up his merchandise by 50 per cent. He then sells it to a large contractor who also pays VAT on the new price and sells the merchandise to a sub-contractor, who must also pay VAT.

He marks it up by 50 per cent and sells it to the consumer at this new price. Before VAT the price for this product would have been $2,250. The new price due to VAT would now be $2,603.07. This is a 15.69 per cent increase. Generally construction materials are 45 per cent and labour 55 per cent of the collective cost. This means that labour would then increase by 19.18 per cent because of VAT; giving the consumer (15.69 + 19.18) a 34.87 per cent mark up in price because of VAT.

Here are a few more facts for you Mr Prime Minister and Members of the Cabinet:

1. The businessman’s sales will increase by 7.5 per cent due to VAT, allowing him to earn an additional 3.75 per cent, and can now live off of 6.25 per cent of his income instead of 10 per cent VAT has only made this wealthy man wealthier.

2. The middle class home owners who now live off 100 per cent of their income, due to the recession, will be subjected to a 34.87 per cent increase in cost of living because of VAT and must now live in debt, sinking them below the poverty line. They were already spending 100 per cent of their income, where are they to get the additional 34.87 per cent?

3. The poor who were already below the poverty line (again, the majority of Bahamians) will sink further below that line. Would there be any hope for them? By increasing the number of poor and severely impoverished amongst us we would become a nation of pan handlers, which would ruin our tourism industry.

4. The businessman has a way of recouping what he spends on VAT, as Mr John Rolle says, “He passes it on to the consumer.”

Honourable Mr Christie, I write this letter to you because you say you are “For Bahamians!” You also said, “I have to do what’s best for the country, and if it won’t hurt the people, I’ll push it forward.”

Well, sir, VAT will hurt the people, it will hurt the tourism market and it will hurt the country. The only individuals benefiting from VAT will be the rich, the small minority. That is the evil heart of Capitalism.

I was born and grew up in a country dedicated to the pursuit of utilitarianism, the philosophy that the best course of action is the one that helps the greater number of people. Since government is to be for the people and VAT is against the people, this government should be against VAT.

I do have some good ideas about reducing our country’s debt if you wish to hear them. You can contact me.

REV TERRENCE A JONES

Pastor, Eternal Light Deliverance Centre,

Freeport,

Grand Bahama,

September 17, 2014.