By NEIL HARTNELL
Tribune Business Editor
THE Government was yesterday urged to improve the "God awful" delays and bureaucracy encountered in obtaining tax credits and refunds.
Robert Myers, a principal with the Organisation for Responsible Governance (ORG), told Tribune Business that the Minnis administration needed to treat taxation as a "two-way street" to improve the Bahamas' 'ease of doing business'.
He disclosed that his own businesses had become so frustrated by the wait for Customs duty, Excise Tax and VAT (at the border) refunds that they rarely bothered to apply for them, even if the Government's revenue agencies owed them money.
While agreeing that the Ministry of Finance had moved to make the process of paying taxes easier, Mr Myers said: "They now need to strategise and focus on the tax credits and refunds, because that's God awful.
"They need to do a better job on credits. When they [the Government] owe money, they don't pay it. We see it all the time. We can't get refunds from government."
Private sector complaints over the timeliness of VAT refunds and credits have frequently been voiced since the 7.5 per cent levy was introduced on January 1, 2015.
Many have attributed the delays to the Public Treasury's own cash flow issues as a result of the Government's strained fiscal position, but the wait for due payment results in cash flow problems of their own for businesses.
"If four to five items are shown on an invoice, but are not in the trailer when it's opened for inspection, you've already submitted the declaration and paid the duty," Mr Myers told Tribune Business.
"If something on the invoice is not there, we don't bother [claiming the tax refund], as it's so hard to get a credit on the duty. That's just impossible. We never see it, and if they did give it, it takes a year, year-and-a-half to get it. I'm not sure we've ever had one, so we don't bother. That happens; we know better."
He added: "You can't change the invoice, but if something extra is shipped and is not on it, they'll fine you for it. Yet if it's not shipped, you've already paid Customs the duty and the VAT.
" A two-way street has got to be done. We get fined, and even jailed, if we were to do something wrong, but if it goes the other way nothing happens. There's no accountability on the Government side. If I can file and pay [VAT returns] in 21 days, they should be able to do the same. If they don't, they should get fined."
Mr Myers's concerns, which are likely to strike a chord with many in the private sector, came as the Bahamas was ranked 55th by the World Bank's 'ease of doing business' index for the 'ease of paying taxes.
That was this nation's highest individual category ranking, with the World Bank report finding that the 31 tax payments required from a medium-sized Bahamian company was slightly higher than the Latin American and Caribbean average of 28.
The collective 31.5 per cent tax rate faced by Bahamian companies, as a percentage of profits, was lower than both the 46.6 per cent regional average, and the 40.1 per cent for high income OECD economies.
This gives weight to those who argue that the Bahamas is not a 'high tax' jurisdiction, and the average 233 hours per year spent on paying taxes by a medium-sized Bahamian company was also less than the 332.1 hours in Latin America and the Caribbean.
The 12 monthly VAT filings were estimated to take up 157 hours per year, while National Insurance Board (NIB) contributions accounted for another 66 hours.