The Tribune

EDITOR, The Tribune.

Dr Hubert Minnis’ promise to “incrementally increase” the national minimum wage if the FNM wins the next election will be a big mistake.

Most economic indicators point to a very slow recovery over the next several years; any increase in the minimum wage will be a major setback to further economic growth.

Small and medium size businesses, in particular, will feel the brunt of any increase in the minimum wage. The consequences will be far reaching. Many business owners will be forced to increase already high prices and reduce employment levels. This will have a negative growth multiplier effect in the Bahamian economy.

Unlike the economic boom being experienced in countries like Germany, Brazil and the United States, where minimum wage has been introduced or increased recently, The Bahamas’ economy is still in the doldrums with an unacceptable high rate of unemployment.

Politically this may sound like a populist position to advance but it is a bad idea for workers, consumers and business houses.

Similarly, Dr Minnis’ proposal to remove VAT on some items and make up for the lost in revenue by taxing “the winnings” of web shop gamers only hurt “the poor and declining middle class” because they are predominantly the persons who partake in gaming.

FLOYD HANNA

Nassau,

January 9, 2015.