The Tribune

By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

The Democratic National Alliance (DNA) yesterday pledged to return $90 million to Bahamian businesses and the wider economy by reducing Business Licence fees to a nominal sum.

Party officials said their proposed tiered structure, with fees ranging from $100 to $1,000 per annum, would effectively deliver on the Government’s 2013 promise of fundamental Business Licence reform following VAT’s introduction.

The DNA’s plan is that small ‘mom and pop’ operations pay an annual $100 Business License fee; medium-sized businesses pay a $250 annual fee; medium to large businesses pay a $500 annual fee; and large businesses pay a $1,000 annual fee.

Chris Mortimer, the party’s deputy leader, said: “That would equate to putting approximately $90 million back into the pockets of Bahamian families.

“That would do wonders for our economy in terms of businesses begin able to pay salaries and just survive.”

Addressing the issue at a press conference at the DNA’s East Street South headquarters, party officials  said that while the Government has increasingly seen Business Licence fees as a vital revenue source,many businesses were being crushed by heavy taxation.

They explained that businesses such as food stores and gas stations, which are high volume but low margin/net income, often end up paying Business License fees far greater than their annual profits because the tax is based on gross turnover.

“When the Government put out the VAT ‘White Paper’, they projected that at 15 per cent the Government was going to, on an annual basis, take in $400 million,” Mr Mortimer said.

“The Government reduced it to 7.5 per cent and has gotten more in the past two years than they projected when they introduced the ‘White Paper’.

“Every dollar that they make comes from the pockets of Bahamian families and businesses. We cannot  have growth in this economy when the Government feels that they can add additional lines of revenue attached to the wallets of Bahamian citizens and families.”

Mr Mortimer added: “To jump start economic activity we are going to follow a simple formula. We are going to start allowing Bahamian families and businesses to keep more of the money that they make.

“This month there are businesses, whether they are ‘Mom and Pop’ or large businesses, which are having to make the decision of paying Business License fees on top of VAT and Customs duties.”

The Government’s VAT ‘White Paper’, released in February 2013, initially proposed scrapping the Business Licence fee and replacing it with a flat $100 annual levy on all businesses.

The Christie administration subsequently decided to keep the existing Business Licence regime and fee structure until it was certain VAT is generating the projected, and required, revenues.

Mr  Mortimer said: “The Government had proposed that with the introduction of VAT it was going to reduce Business License fees. Today, after more than $1 billion has been taken out of Bahamian businesses and families, they still haven’t lived up to that.

“We say that 2017 will be the last time that Bahamian entrepreneurs and business will be paying Business License fees as they have done, as a percentage of their revenue.

“No commutations will be made on the gross or the net. We are going to live up to what they proposed in the ‘White Paper’.”