The Tribune

By RASHAD ROLLE

Tribune Staff Reporter

rrolle@tribunemedia.net

IN yesterday’s Speech from The Throne, the new government said it will reduce value added tax on breadbasket items, as the Minnis administration also outlined plans to transform Over-the-Hill communities.

It is not clear if this is a shift in the administration’s VAT plans, as the Free National Movement had repeatedly promised in recent years to repeal VAT on such items, not just to reduce the tax rate on them.

Details of the government’s tax plans were outlined in yesterday’s Speech from The Throne, read by Governor General Dame Marguerite Pindling.

The government said it “will take action to effect a reduction of VAT on breadbasket items”.

In June 2015 during a budget debate in Parliament, Prime Minister Dr Hubert Minnis, then the leader of the Official Opposition, said placing VAT on breadbasket items was cruel and heartless.

“An FNM government will repeal VAT on breadbasket items, all baby and children’s clothing, electricity, water, all health coverage and insurance,” he said at the time.

More recently, during a rally in Grand Bahama on April 21, Dr Minnis said: “Your FNM will immediately remove VAT from breadbasket items to bring relief to the less fortunate.”

He said “it is unconscionable that the PLP put VAT on health care” during a rally on Christie Park in April.

No mention was made yesterday of either reducing or eliminating VAT from the non-breadbasket items from which the FNM pledged to eliminate the tax.

Progressive Liberal Party members highlighted the difference between “reduction” and “elimination” during their press conference yesterday afternoon, with Leader of the Official Opposition Philip “Brave” Davis claiming the government has changed its tune.

Nonetheless, the Minnis administration also recommitted itself yesterday to creating tax free zones in Over-the-Hill communities.

It is hoped that this will “encourage business growth and spur job creation,” the Speech from The Throne noted.

“My government is deeply aware of poverty, especially in the inner city of Nassau, and is determined to eradicate ‘in your face’ physical conditions that demean the dignity of our people,” the speech noted. “For decades residents in Over-the-Hill areas have not received the kind of attention required to transform their business, residential and overall (environments). Accordingly, my government will institute urban development by revitalising inner city communities (Urban Renewal) and expanding the reach of social services.”

Within inner city zones, the government said it will allow duty-free concessions on construction materials and building supplies used to construct business premises.

During its general election campaign, the FNM promised duty-free importation of construction materials on both commercial properties and residential properties in such areas; no business licence fee or real property taxes; and no taxes on certain household furniture. It also promised reduced customs duties on special vehicles necessary for businesses. These campaign promises were not specifically mentioned in yesterday’s speech.

The government also recommitted itself to launching a programme of real property tax discounts and rebates for pensioners 65 or older who qualify.