By NEIL HARTNELL
Tribune Business Editor
Bahamian businesses are not opposed to regulation, just its inefficiencies, two private sector leaders have told Tribune Business.
Gowon Bowe, pictured, the Bahamas Institute of Chartered Accountants (BICA) president, told Tribune Business that the “push back” from legitimate businesses stemmed from the obstacles and bureaucracy in the Government’s compliance processes rather than any opposition to the notion of being regulated.
Speaking after the Government confirmed it is eliminating the need to obtain upfront proof of National Insurance Board (NIB) compliance before business licence renewals are issued, Mr Bowe said it was vital that different public sectors communicated with each other electronically to ease the burden on the private sector.
Similarly, Michael Maura, the Bahamas Chamber of Commerce and Employers Confederation’s (BCCEC) chairman, told this newspaper that the NIB step’s elimination in time for 2019 Business Licence filings was “very much welcomed” as part of a wider effort to marry enhanced tax compliance with better customer service.
“Ultimately the desire is that the Government and its various agencies have systems that speak to one another, and follow the idea that of ensuring businesses are in compliance with laws and regulations but ease the burden of doing that,” Mr Bowe said.
“Having to go to different agencies is tedious. Businesses have no difficulty doing that if it can be done online, or in some fashion that allows for the agencies to report back to the Department of Inland Revenue.”
Mr Bowe said the Government’s information management and approvals processes will benefit the more its various systems are integrated, and added: “I don’t think businesses are saying to the Government: ‘We don’t want regulation’. Most businesses are saying: ‘Efficient regulation’.
“The Government needs to satisfy itself their in compliance with applicable laws and regulations without being restrictive. All the push back is coming from efficiencies embedded in the process. The more efficient we’re able to carry out these processes, the less push back we’re going to have.”
Mr Maura, echoing the BICA president, said: “I believe that any and all steps that the Government can take to both streamline and reduce the bureaucracy, and time the corporate citizen spends complying with regulation, is a great step towards a modern, efficient and growing economy.”
Backing the NIB ‘letter’ move, he added: “Our expectation, though, is that this progressive step has been facilitated and accomplished by intra-government connectivity, which simultaneously accomplishes tax compliance verification and great customer service.
“This is important as its effective success mitigates the possibility of excessive taxes which often exist when a government is inefficient.”
Marlon Johnson, the Ministry of Finance’s financial secretary, confirmed to Tribune Business earlier this week that the Minnis administration has ended “one of the major issues of contention” for the private sector by eliminating the NIB ‘letter of good standing’ requirement up front.
He warned, though, that companies are “not off the hook” when it comes to being current with NIB contributions, as compliance checks have now moved “from the front end to the back end”.
Mr Johnson said the ministry remains firm in not issuing business licences to firms that are delinquent on their social security contributions, and promised that the Department of Inland Revenue will be constantly checking with NIB to identify those that are non-compliant.
“Instead of having businesses do that on the front end, we will do that on the back end to determine if businesses are compliant. That was one we realised we could do very readily at the back end,” he added.
“This does not get businesses off the hook to be compliant with NIB. We are working with NIB to get information on delinquent businesses upfront. We will check when businesses come in against the information we have, and not extend Business Licences to persons who the data indicates are non-compliant.
“It’s incumbent, before businesses come to us for Business Licences, to ensure they’re compliant with NIB if they have reason to think they’re not.” The timely, and full, payment of due NIB contributions has been a regular compliance issue for The Bahamas’ national social security system.
Yet Bahamian businesses have grown increasingly frustrated in recent years with the Government’s inefficient, cumbersome approvals processes, many of which remain paper-based amid the lack of electronic (Internet) connectivity between different agencies and departments and with the private sector.
A regular complaint has been the need to visit, and obtain, approvals from multiple agencies to gain key permits such as the Business Licence, all of which costs companies time and money, and undermines the “ease of doing business” in The Bahamas.