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Cooper Says Govt Helping Wealthy Not Small Firms

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Chester Cooper

By RASHAD ROLLE

Tribune Staff Reporter

rrolle@tribunemedia.net

EXUMA MP Chester Cooper criticised the Minnis administration yesterday for producing a budget that gives tax breaks to big businesses and not smaller ones.

The Business License (Amendment) Bill 2017 would reduce taxes from 1.5 per cent to 1.25 per cent for businesses with a turnover exceeding $50m.

“I would imagine that the list of businesses that will benefit from this exemption is decidedly small and it would be very, very interesting to look at the list of businesses to examine who might be the beneficiaries of this tax break,” Mr Cooper said.

“…If I am right, this implies that there goes another tax break for rich, big business who might be cozy with this ‘people’s time’ government whilst there is no reduction for small and medium sized businesses who also employ people but struggle every day to keep their doors open. As is the case with most modern economies, small business account for as high as 70 per cent of jobs in the private sector and is considered the engine that drives organic economic growth.”

Mr Cooper’s comments came as he delivered his maiden speech in the House of Assembly.

Deputy Prime Minister and Minister of Finance K Peter Turnquest suggested that the tax breaks for big businesses sprung from an agreement the former administration had with Atlantis to reduce its taxes. However, former Deputy Prime Minister Philip “Brave” Davis said that agreement related exclusively to hotels as a way to make them more competitive with others in the region. The agreement would not have extended to businesses outside the tourism sector, he said.

Nonetheless, Mr Cooper also questioned whether someone in the governing party will benefit from a customs duty reduction on paint.

“In prior years, the government increased duty on bottled water to protect (the local) industry and jobs,” he said. “A reduction on duty on paint by 20 per cent will potentially harm the local manufacturing industry resulting in job losses and adversely impacting lower income households…I want to know why? And who stands to benefit? Without suggesting anything untoward, before I vote on this budget, we would be grateful if the government would declare whether any members of this Cabinet has a substantial interest in a paint distribution who might stand to gain.”

Mr Cooper, who has a background in business and is the former chairman of the Chamber of Commerce, criticised the government for making tax related promises without, he suggested, examining the impact such changes would have.

As an example, in the lead-up to the general election, Prime Minister Dr Hubert Minnis said the FNM will “immediately” repeal value added tax (VAT) on breadbasket items, and also pledged to remove the tax from other areas.

The new administration has since said its plans for tax reform cannot be implemented in the short-term due to the state of the economy inherited from the Christie administration.

“A system with limited exemptions enables a more efficient tax scheme,” Mr Cooper said. “We’ve been through this over and over again. It’s too late to be playing catch up on how VAT works. Varying rates and/or exemptions, would require system amendments and increases the complexity of the tax collection and filing process, which is already a sore point for the business community. A change will likely impact the level of system related costs and compliance rates experienced with VAT. Fewer exemptions and more elimination/reductions of customs duties might be the way to go to create a more comprehensive VAT.

“I ask, who analysed this campaign promise? They would have had access to the great body of work by the chamber and its Oxford economists, the IMF, the IDB and the Compass Lexecon (US consultants engaged directly by the government) and others who rely on empirical analysis. Should the government start tinkering where it should not, I foreshadow that it would likely result in the increase of VAT to as high as 15 per cent. We must not inflict this injustice on the Bahamian people.”

Mr Cooper touched on a theme the Progressive Liberal Party (PLP) has embraced, accusing Mr Turnquest’s budget communication of being inappropriately political and dour on the country’s financial situation.

He cited recent statements by Moody’s expressing alarm that the country’s debt levels will be the “highest for an emerging market sovereign rated BAA” as an example of the consequence of such statements.

“It’s the wrong speech at the wrong time in the wrong place,” Mr Cooper said. “We have come to appreciate careful deliberations in this important communication so as not to talk down or undermine the economy.

“I wonder whether this is the speech we will take with us when we go to defend the international rating of the Bahamas? Is this the one that we will take to the debt market? You don’t tell me you’re broke, you busted, you unemployed and the ‘cupboard is bare’ then ask me to borrow $722m.”

Comments

TalRussell 3 years ago

Comrades! Why is the Red Regime in such a 'rush' to be so generous to corporations doing in excess 50 million dollars annually [and, if you're incapable turning a profit from $50 plus millions in sales] it's not the People's responsibility to provide you with $444,000 in 'corporate welfare' for each future years you're in business - whilst the Minister of Finance "KP" declines remove VAT from 'bread basket' items - the same damn 'breadbasket' items on the profit making shelves of the recipient $444,000 annually.
The prices 'bed basket' items is done too damn high!
[You can't make this $444,000 'corporate welfare' up}.
Lord Jesus, brungs a healing of compassion for the 'bread basket' items to "KP".

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birdiestrachan 3 years ago

Mr.: Cooper and Ms. Hanna Martin made me so very Proud It was a pleasure to watch them with no malice , sometimes with smiles but always with the facts..,,

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BahamaPundit 3 years ago

Mr. Cooper is the man!!! He is so much better than other PLPs. He should definitely lead the party.

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proudloudandfnm 3 years ago

I agree with this.

I can use a 25% discount on my taxes....

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TalRussell 3 years ago

Comrade ProudLoudAndFNM, you would still pocket the 25% savings discount on your taxes - even knowing those who most depend on the 'taxable bread basket' items - will be footing the bill for your 25% savings?

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Baha10 3 years ago

Cooper appears to be the sort of Bahamian we can build a Country behind, Black, White, Rich, Poor, so far, very impressive in his role as 1 of 4 in Opposition and soon deserving of being nominated Leader.

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banker 3 years ago

His judgement is really impaired. He joined the PLP behind a Christie backed regime, not knowing that Christie would lose. Anyone who joins Crisco Butt in any endeavor needs his head examined. Chester disappointed me deeply.

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DDK 3 years ago

So perhaps he will be invited to join the FNM? If what you see is what you get he would be an asset to the red party!

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licks2 3 years ago

Not only that. . .that budget was made up by the last government. . .any public servant can tell you that it take the system about 5 to 6 months to put together the budget for presentation in HOP. . .and by the time a new government is elected the next fiscal year budget is already put together and presented. . .this new government is no different in this budget. . . they will not have footprints in a budget until the 2017-18 budget!! If memory serve me right, Mr. Turnquest told that same Mr. Cooper that he was reading from former PM budget speech! That's the reason they do not wait for a new government to produce its own budget is that law require that the new budget gets started end of June. . .which leave the new government with no time to adjust the current budget!! So anybody with a little knowledge of how these budgets work. . .Mr. Cooper is either lying or he just don't know what is going on in this nation. . .either way. . .he need to go in one room and sit small!!

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ThisIsOurs 3 years ago

"Deputy Prime Minister and Minister of Finance K Peter Turnquest suggested that the tax breaks for big businesses sprung from an agreement the former administration had with Atlantis to reduce its taxes"

I hope Dr Minnis is listening. This man doesn't have a solid explanation for anything. It too early for dis. Does he even listen to himself? The FNM's platform was "the small man" and his excuse for not looking after the small man was "doh....dis what the PLP give me"????

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sheeprunner12 3 years ago

It takes the rich man to build economic opportunities, so that the small man can find jobs ........ DUUUUHHHHHH ......... Can the small man employ himself????? ......... That is why we have so much welfare bullshit like UR2.0

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sheeprunner12 3 years ago

Cooper is one of the black nouveaux-riche PLPs who have taken a page out of the Pingdomite kleptocracy .......... He is well aware of how a government can "grease the wheels" of its elite

COOPER IS PART OF THE GRAVY-TRAIN CHOIR ........ SING ON MY BROTHER!!!!!!!!!

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ThisIsOurs 3 years ago

Not sold on him either. Gaming links..

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DDK 3 years ago

Mr. Cooper appears to be quite right! Are you listening FNM leaders?

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Naughtydread 3 years ago

Strange that this is the same man I saw wining and dining with the VP of Aliv, I wonder if he is willing to reduce tax rates for his close friends?

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observer2 3 years ago

Reduced taxes on commercial washers and dryers, reduced taxes on aircraft part and reduced business license fee....all for the rich.

Anything for the poor? No University of the Bahamas free education. No Bain Town tax free zone. No VAT exemption on bread basket items. No nuttin for over the hill that just voted the PLP out.

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sheeprunner12 3 years ago

It takes the rich man to build economic opportunities, so that the small man can find jobs ........ DUUUUHHHHHH ......... Can the small man employ himself????? ......... That is why we have so much welfare bullshit like UR2.0

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The_Oracle 3 years ago

Yet we have a government policy of "tax breaks" on real property tax if you come in and pay a reduced amount on arrears. What about the damn fools who have been paying the full amount all along? The above encourages delinquency! We have it all backwards. Give people a discount for on time payment, jail time for arrears! We need a debtors court!

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