By NATARIO McKENZIE
Tribune Business Reporter
The Government is expected to “reverse” by mid-December its requirement for certified bank statements to accompany business licence renewals, a top accountant has revealed.
Gowon Bowe, the Bahamas Institute of Chartered Accountants (BICA) president, told Tribune Business: “There have been several meetings and conversations on the issue. I think they [the Government] have indicated that they intend to reverse what was recently put into play. There has been a commitment that between now and the middle of December the necessary amendment to roll the requirements for audited bank statements will be addressed.”
This newspaper understands that KP Tunquest, deputy prime minister and minister of finance, will likely meet with the managing partners of Bahamian accounting firms this week to resolve the controversy that erupted over the requirements set out in the business licence regulations.
Mr Turnquest confirmed to Tribune Business that informal talks were being held over the issue, and that the Government would be making a statement on the matter “in due course”.
The amended regulations, which were put into effect almost unnoticed on May 30 amid the general outcry over the Budget’s VAT hike, require companies with an annual turnover of $10m or more to provide audited financial statements that will confirm their prior year earnings.
But for those businesses earning between zero to $10m, the regulations stipulate that “a financial statement” confirming their turnover must be supplied to the Department of Inland Revenue (DIR). This, though, must also be accompanied by “a certified bank statement” covering each bank account held in the business’s name and any other accounts “that are used in transactions” on its behalf.
Many accountants and private sector executives view the new regulations as “overkill” and an incursion into corporate privacy, especially since Business Licence fees are currently calculated based on just one indicator: Top-line turnover. Accountants verify this, with businesses submitting such attestation along with their filings and payment by end-March every year.
There have been some suspicions - vehemently denied by the Government - that the increased information demanded by the new regulations, which will apply for the first time to 2019 business licence filings, is akin to a “trojan horse” paving the way for corporate income tax’s introduction.
Mr Bowe added: “The final wording in terms of what will be required with regards to information and the level of attestation is one that we still need to just see in what I’m going to call ‘black and white’. It is not simply a case of leaving the Ministry of Finance or Department of Inland Revenue exposed without the comfort that they require, but making it more practical for the businesses that have to report as well.
“For the profession there needs to be very clear standards that have to be followed. There is a commitment by the Government to ensure that takes place. We need to ensure that as the professional accountants we are being balanced to ensure that the language of any amendment, repeal or otherwise is not just seen as a desire to maintain the status quo but a desire to ensure a practical but effective piece of legislation.”