By RICARDO WELLS
Tribune Staff Reporter
TALL Pines MP Leslie Miller yesterday applauded the government for having the “guts” to see the Baha Mar deal through, condemning the criticism levelled at the Christie administration after a leaked email from the project’s general contractor revealed that all companies and suppliers working on the resort would be exempt from Value-Added Tax.
Mr Miller told The Tribune that the move to grant all companies working on Baha Mar’s completion “a full” waiver from payment of the 7.5 per cent levy must not be viewed as a missed opportunity for the country to earn income, but a chance to push the “critical important” project to completion.
Mr Miller said the public outcry proliferated by media reports on Thursday came as a result of people “missing the bigger picture” as he asserted that the Christie administration “made the best of a terrible situation”.
“Bahamians must not forget, that project was under,” the outspoken MP said. “And I am talking about having no chance of being completed. Just sitting there, mothballed, for years to come. This is what we had to do to get it done; to get it completed and get workers in there. Isn’t that the goal here?
“The plan was to get it done and completed by any means necessary. The government is depending on that resort, (expletive) the entire country is depending on that resort.”
Mr Miller said the resort’s original developer, Sarkis Izmirlian, would have had identical concessions if he had kept the resort and completed it. Moreover, Mr Miller said if Mr Izmirlian was successful in his original attempt, the country would have never been in a position to collect a 10 per cent ‘transfer tax’.
The 10 per cent ‘transfer tax’, split into 7.5 per cent VAT and 2.5 per cent Stamp Duty, would generate between $100-$200 million on both sales of the resort, if applied in full, according to Tribune Business.
“The developers made a commitment to the government that they would repay all the debts, pay off the creditors and reinvest in the project to make sure that it was up to par to open and be profitable for years to come.
“This the best trade-off that we could have gotten in today’s market and it is in the best interest of the Bahamian people,” the Tall Pines MP said.
“Don’t get lost in the immediate gratification; this was all about the long-term success of the project. There was going to be no VAT, no Stamp Duty had the project went to its original conclusion, correct?
“The project would have hired somewhere around 4,000 Bahamians and pushed billions into our economy, correct?
“The project failed, the developer failed. Now why should I, as a new developer, be punished by paying these fees for rescuing this project? We now have a new developer who has the financial acumen to finish the project and should be given all that is available to us as a country to make sure that this resort is completed.”
He added: “As a country, we were not going to get it any how. We had nothing to offer and yet still, someone stepped up to the plate. The government should be applauded for its ability to get this done. This took guts.
“All of us could pretend to be the quarterback of the team when we aren’t on the team. We have to wake up to reality. I don’t think you wanted to have that monstrosity sitting on our shore not being used. Let’s appreciate the fact that this is behind us now and this project is on its way to completion.”
Both Opposition Leader Loretta Butler-Turner and Free National Movement Deputy Leader Peter Turnquest have come out against the arrangement.
Mrs Butler-Turner, who heads the Public Accounts Committee, said the VAT-related disclosures in an e-mail from the project’s main contractor, China Construction America (CCA), provided “a great springboard” for her to demand an inquiry when the House of Assembly resumes on Monday.
Mrs Butler-Turner described the VAT exemption as “ludicrous” and “unbelievable”, although she conceded that an earlier heads of agreement with major foreign developers never needed to account for the tax, which was introduced on January 1, 2015.
For his part, Mr Turnquest questioned whether the government would have to extend Baha Mar’s VAT exemption to Atlantis, given the resort’s ‘Most Favoured Nation’ status, which requires it to receive the same incentives as any other Bahamas-based investor.
Baha Mar was purchased by Chow Tai Fook Enterprises (CTFE) last year, with all agreements related to the sale being sealed by local courts.