By NATARIO McKENZIE
Tribune Business Reporter
nmckenzie@tribunemedia.net
THE 5,600 and more quarterly Value-Added Tax (VAT) filers will provide a “real test” of the VAT Department’s systems, a Task Force co-chair said yesterday. He urged businesses to avoid the last-minute rush and file their returns before the April 28 deadline.
Edison Sumner, a VAT Education Task force co-chair and Bahamas Chamber of Commerce and Employer Confederation CEO, said yesterday that while the VAT Department’s system has worked well thus far, the real test would occur next week.
“The only complaints that we have heard from persons trying to file is from those taking too long to get the filing completed and they get timed out,” he said. “The systems work fine but there are some who may just take an inordinate amount of time completing the filing of their returns and when that happens they get timed out. For those experiencing that we would suggest that you save your inputs as you go along so that if you do get timed out you can go back and start wherever the system ended you in that process.”
“This is going to be the test now, to see how well the system is built, how robust the system is and whether it can take the volume that is coming through. We have been advised by the VAT Unit and the persons there including the VAT Comptroller that the system is ready to handle the volume that is going to come through it.
“We will know better come next week Wednesday or through the next few days when people begin filing,” said Mr Sumner.
He noted that, based on the heavy volume of filers anticipated, the Task Force is encouraging businesses start filing early. “If everyone waits until the last minute and everyone tries to rush their filings through on April 28, then the systems may be challenged. The way to avoid that is to file early. The government’s system has never been challenged like this before and we will see how it turns out. We expect that it will be able to handle what comes through.”
Andrew Rodgers, the Nassau Glass and Bahamas Aluminum Manufacturing principal and member of the VAT Education Task Force, said that there are in excess of 5,600 quarterly filers. Mr Rogers has long advocated that those businesses file their VAT returns incrementally.
While it is unclear how many businesses have done so, Mr Sumner noted that there are companies who have used this approach.
Task Force member and Fidelity Bank (Bahamas) Ltd President, Gregory Bethel, appealed to businesses to file their returns on time, warning that failure to do so would subject them to a fine of $10,000, six months imprisonment or possibly a fine and prison sentence.
Businesses can file and pay via the government’s online tax administration system, through their banks’ online banking service, over the counter at most banks and by cash or cheque at any RBC branch.
Comments
John 9 years ago
There will be some business casualties as some business find themselves in a position of not having the cash on hand to pay VAT. Since filing late and paying late will result in 'hefty fines', according to a government spokesman persons caught in this position will have no option but to close shop. The situation is a Catch 22 one because many medium and smaller businesses were experiencing a cash flow problem prior to the VAT introduction. The additional cash flow generated by VAT may have deceived these persons into believing their overall business position had improved. That is until now, when the time has come to pay VAT, and there is no cash.
outlier 9 years ago
As a business owner in Canada, we are "tax collectors" for the provincial and federal government and must file on time or else. What Bahamian business owners must do and I mean must do is:
Set up a separate account with your business bank for the deposit of the VAT that has been collected. Do not put this money into your general revenues, as you will start thinking that the funds are yours. This is not your money. It belongs to the government.
As the months progress, you will get used to separating your money from the government's money.
Trust me on this. Many small and medium sized businesses in Canada close down their business activities because they can not pay the Provincial Sales Tax or Goods and Services Tax.
As a business owner, I learned early to put the collected tax money into a different account so I wouldn't get attached to it. And, file quarterly, so you have less administrative tasks each month.
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