The Tribune

By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

The Government is extending the Hawksbill Creek Agreement’s (HCA) expiring tax incentives for a further six months, the Prime Minister announced yesterday, telling Parliament there was still “a great deal for the Government to digest”.

Perry Christie said there was a need for more time for further consultation and negotiations with stakeholders on Grand Bahama.

The Government had commissioned international consulting firm, McKinsey & Co, to conduct a study on the expiring incentives, and then appointed a six-member committee to produce a report on both those tax breaks and Freeport’s long-term future.

    “The tax concessions in question are of great importance to the further economic development of the city of Freeport, and the entire island of Grand Bahama,” Mr Christie said.

“Due to the in-depth and comprehensive nature of the study and the report of the committee, which would also require further consultation and negotiations with stakeholders and the Grand Bahama community, more time is clearly needed to complete this vital exercise. “In due course, following the completion of Cabinet’s deliberations, Parliament will be provided with the information contained in the study and the committee’s report.”

Emphasising the “thoroughness” of the review that was carried out by the committee, Mr Christie said it had met with more than 100 stakeholders, including civil society, manufacturers, developers, tourism operators, professionals and present and former Parliamentarians drawn from both sides of the divide.

“Clearly, there is still a great deal for the Government to digest and consider before settling the longer way forward based on the study by the consultants and, more especially, the report from the Committee,” the Prime Minister said.

“In the meantime, however, and at least for the short term, it is vitally important that we maintain the status quo as it relates to the tax concessions in question. This will require a short extension of six months to the existing 1993 Hawksbill Creek Grand Bahama (Deep Water Harbour and Industrial Area) (Extension of Tax Exemption Period) Act.

“Those concessions are due to  expire on August 4. The tax concessions available to licensees in the Port area of Grand Bahama – better known as Freeport - include no real property tax or real property levy; no personal property tax and no capital levies or taxes on capital gains or capital appreciation; and no taxes of any kind on the earnings of the Port Authority or the earnings of its licensees.”

Mr Christie described the extension as being necessary to “enable full analysis and further consultation, if necessary, so as to set the foundation and framework for the accomplishment of Grand Bahama’s full potential in the national interest for the benefit of all Bahamians”.

The Government-appointed committee’s recommendations on Freeport’s future were presented to Prime Minister Christie, and subsequently to Cabinet, last month.

The committee had been appointed on March 5 and comprised Dr Marcus Bethel, a former Cabinet minister; Sir Baltron Bethel, the Prime Minister’s senior policy advisor; former Central Bank governor, James Smith; Kevin Seymour, the Grand Bahama Chamber of Commerce’s president; former MP Maurice Moore; and Grand Bahama-based attorney, Cassietta McIntosh.