By NATARIO McKENZIE
Business Reporter
nmckenzie@tribunemedia.net
BAHAMIAN operators have slammed the idea of a 'fast food' tax as an "unnecessary financial burden" on Bahamian families that will do nothing to curb the obesity crisis. Terry Tsavoussis, vice-president of Aetos Holdings, which operates the Wendy's, Marco's Pizza and Popeyes franchises, told Tribune Business that the sector - and business in general - was "taxed enough already". "My personal opinion is that we are taxed enough already," he said. "We have a 40 per cent duty on chicken that was enacted since Gladstone Farms was in operation. They have been out of business now for many years.
"We also have to factor in 7.5 per cent VAT and 2 per cent Stamp tax. We are taxed to the hills. There are really only a few items we get, like potatoes and bread, that are duty-free. Cheese has a 15 per cent duty. Our average duty ranges between 15-30 per cent when you look at the whole scale."
Mr Tsavoussis was speaking after Dr Duane Sands, minister of health, revealed last week that, based on advice from unnamed experts, he will recommend to Cabinet that a consumption tax be imposed on the fast food industry. He stressed, though, that this was a long way from becoming policy.
The Wendy's principal argued that taxing the fast food industry would do little to curb obesity in the Bahamas, and merely force franchises to raise their prices. "I don't think it's the answer to fighting obesity. Something like that will affect all quick service businesses," he said.
"This is just politics to be honest. They know that we do well, and they want to see how they can tax us. At the end of the day it will have a negative effect. It will force us to raise prices. People will continue to eat what they want but it will just cost more. Our consumers like this kind of food because it's convenient."
Mr Tsavoussis added that his fast food chains offer healthy options, but again underscored consumer preferences. "We have healthy choices. The chili that we sell, for example, is a healthy option," he added.
"Our spicy chicken sandwich represents 11 per cent of our total sales. By comparison, the grilled chicken sandwich that we offer is just under 1 per cent. It's not rocket science; people have a preference."
Ash Henderson, director of marketing for Restaurant Services, the Kentucky Fried Chicken (KFC), Burger King and Dunkin Donuts franchise operator, told Tribune Business: "We respect the Minister's concerns and his advocating for healthy eating habits. That is why we offer a range of healthy and affordable options in our restaurants, including vegetarian options, salads and wraps, and healthy sides in our kid's meals.
"We do, however, feel that a fast food tax is an unnecessary financial burden on hard-working Bahamian families, and that there are alternative ways to encourage a balanced diet."
Comments
Economist 6 years ago
I agree with a Fast Food Tax.
If people want to eat foods that make them sick that is there right AS LONG AS THEY PAY THE BILL FOR THIER ILL HEALTH LATER ON.
They will show up at the PMH with high blood pressure, heart attack, cancer, diabetes 2. Obesity is the number two or three cause of cancer in many countries.
Fast food is the leading cause of obesity in many countries and, as we have been reported to be the sixth fattest country in the world, it would seem that fast food is playing its part here.
Other countries are introducing taxes because their national health programs can't keep up with all the cost of the sickness caused by obesity.
So yes, tax the fast food 10% or 20% extra and put it into the National Health system.
hnhanna 6 years ago
Fast Food need to make changes to their menu and put more healthy products.
DonAnthony 6 years ago
We absolutely need a fast food tax, one of at least 15%. It will deter some from eating such unhealthy food, and it will help cover the cost of the increase in healthcare to treat persons who are obese in part beacause they frequent these establishments. Why should my taxes be increased to pay for NHI while Mr. Tsavoussis gets rich. He should be ashamed of himself making such an argument, I hope he sleeps well at night knowing that he sells a toxic product that is leading many of our citizens to an early grave. He has a moral responsibility to help pay for the terrible healthcare problems he is causing and getting rich from.
bcitizen 6 years ago
Chicken is 30 percent not 40. Shows how much he knows his business. Fast food is killing Bahamians. It is poison. "people have a preference" People also have a preference to drive drunk, do not wear a seat belt, do drugs, smoke and drink (both are heavily taxed) and many other things that are considered dangerous and unhealthy but, the government sometimes has to protect people from themselves especially when we have a quasi government funded health system supported by taxes. Want to have bad habits? Then they need to be taxed to pay for your healthcare. How much economic loss does the Bahamas suffer due to obesity, health care costs, loss of productivity, and shorter lifespans?
joeblow 6 years ago
Just like in any other business the law of supply and demand is in play. With fast food businesses they pay customs duties, VAT and now the govt is considering sales tax on top of that. It is unreasonable. The costs will be passed on to the customer and companies will have to run leaner to ensure they maintain profitability.
If you tax fast food, you should also tax gambling houses and increase taxes on alcohol and tobacco! They hall have negative effects on health!
bogart 6 years ago
Fully agree with you Joeblow!!!
And while we are at it lets move on to paying taxes for free govt public schooling etc for foreigners.
bogart 6 years ago
....it is simply not fair for Bahamian citizens to be paying taxes to support the foreign maids, gardeners and other foreign workers who bring in their children and other family members who utilize the gpvt schools and other services for free!!!!.....And as a result of this massive expenditures outlay to provide for forrogners..Bahamian are deprived of better quality and benrfits for themselves.
Dawes 6 years ago
Problem is a lot of these foreign workers are being bought in to help tackle the health crisis PMH is suffering from due to all the unhealthy eating. Also once these foreigners are here they should be being contributing NIB, Paying VAT when they make purchases , having a work permit fee paid to Government, all of which contributes to paying for those school fees etc.If they are not it will be because their employer (a Bahamian) is not doing what they legally should. Or should we pass a law saying if you haven't contributed for X years (say 5) then you can't benefit from any Government Service. Of course this will affect many Bahamians as well. .
sheeprunner12 6 years ago
There is nothing healthy about fast food ........ It should be taxed just like cigarettes .... 200% ..... and while you are at it do the same with soda, beer, rum, white rice/sugar/flour, yellow cheese etc. ........... This country is at a drastic point in social health and it will take drastic measures to fix it ...... Eat native foods and ban 85% of the garbage sold in the foodstores and restaurants.
OldFort2012 6 years ago
Just look at the passengers on any Bahamasair flight out of Florida back to Nassau.
Average weight: 300 pounds.
Your average Bahamian should be made to buy 2 tickets when flying.
Whatever this tax is, it is not nearly enough.
TheMadHatter 6 years ago
Perhaps some compromise. Increase their VAT to 10% and also ask KP if he has anybody smart enough at Finance to keep track of that 2.5% and require the sign-off from the Min of Health to spend any of it.
Doubtful though. Govt seems to only like one big "consolidated fund" which allows for no end of foolishness. That aspect of the Constitution needs amending quickly.
Economist 6 years ago
The point is that if you want to eat fast food, be my guest,. Just don't ask me to pay for your hospital and doctors bills.
Pay an extra 10% or 20% on your fast food bill so that you have already made a contribution to the ill health caused by your fast food habits.
You pay high tax on cigarettes so why not pay some tax on fast food, neither is good for your health.
Dawes 6 years ago
On Thursday look at the obituaries, there are far too many middle age Bahamian dying long before they should. We are getting close to a time when the life expectancy is going to decrease for the first time in a long time. Government has a social duty to do what is best for its people. They can do this in two ways, the carrot or the stick. The carrot would be to encourage healthy eating with tax reductions on healthy food, and encourage an active lifestyle by ensuring adequate and safe parks in neighbourhoods. The stick is to tax those things that are unhealthy. Everyone knows fast food is unhealthy, as with Cigarettes, drinks and a number of other items. Tax them to raise the funds to pay for the subsequent health issues and people can then deiced if that Number 5 biggie size is worth it or not.
Sickened 6 years ago
I like fast food; it is a great way to cull the many gluttonous among us. The weak are supposed to die out. Why we try to save everyone from their own devices and weaknesses is beyond me. When the poorest and most gluttonous among us either die out or start making better decisions in life then fast food will die out as well.
The_Oracle 6 years ago
No action or law enacted ever has the intended effect, but always has un-intended consequences. Rarely, if ever do they re-visit in 6 months, or ever to discover the mess they've made.
TalRussell 6 years ago
Ma Comrades, allowing remittances of royalties to foreign franchise corporations should be done away with.... if local merchant tried the same kind remittances out the country, their request be flatly denied by central bank.
sheeprunner12 6 years ago
Giving Bahamians "preferences" should be tempered with the social effects of engaging in those "preferences" ......... A person who eats fast food more than twice a week is vulnerable to all kinds of NCDs ......... That is the hard cold facts ........ So, the next time you have to fill out a insurance or health questionnaire, it should ask you that question (frequency of consuming fast food each week). ......... Will Wendy's, Popeyes, McDonalds and Dominos pick up the Healthcare Bill of the country?????? ........ While the Greeks, GB Royal Family etc. pocket their millions??
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