Electric bill exemption on VAT is raised to $200

As of Thursday, June 7, 2018

Deputy Prime Minister and Finance Minister K Peter Turnquest.

By KHRISNA RUSSELL

Deputy Chief Reporter

krussell@tribunemedia.net

THE value added tax exemption ceiling on electricity bills has been raised to $200, Finance Minister K Peter Turnquest revealed yesterday.

The change will come into effect August 1.

Last week he announced the ceiling would be $100, but the decision was met with calls to increase the limit as some consumers argued not many households fell within the range to receive the exemption.

A week later, yesterday, Mr Turnquest told parliamentarians the decision was made to bring relief to as many people as possible.

The government, he said, will also extend the duty-free provision for clothes, shoes and other clothing related items for retailers in response to feedback from citizens.

"We are extending the duty-free provision for clothes and shoes by application, to include apparel, fabric, thread, zippers, and buttons such as to accommodate those who make clothes for themselves or for others," Mr Turnquest said yesterday.

"These duty-free provisions are to be facilitated by application as well and again that's because we want to ensure that the benefits go to those who we are trying to assist.

"We are also extending the electricity bill VAT exemption ceiling from $100 per month to $200 per month. That means that some 63,000 of the 90,000 BPL residential customers will now benefit.

"Again this will apply to all licenced utilities in the Bahamas and it will take effect come August 1.

"Further, just to address a few of the questions we have received, VAT relief on medicines includes over the counter medication."

He continued: "We know that there are further questions regarding this change and we encourage persons to chat with us on our Ministry of Finance Facebook page. Transition guidelines for industries affected will be issued shortly to address issues of contracts and other complex transition matters."

Mr Turnquest also hit back at Progressive Liberal Party Leader Philip "Brave" Davis.

On Tuesday, the opposition leader was non-committal on whether a PLP administration will return the value added tax rate to 7.5 percent should the party be elected to office in the next general election.

Instead, Mr Davis said he was not going to make any promises because he could not say what condition the current Free National Movement government would leave the country in following an election.

"In starting this debate, I would be remiss if I failed to note and comment on the observations offered by the leader of the opposition, mostly recently, just last night when he was unable to commit to reverse the tax increase," Mr Turnquest said.

"The PLP wrecked the fiscal house of the Bahamas. They know this, and the numbers are very, very clear. But Mr Davis knows he cannot and will not be able to reduce the VAT because he knows the financial situation that he and his party created. He knows that we are doing the right and proper thing by addressing it by setting up the country for future prosperity.

"If he thought this was the wrong move, he would be brave enough to commit to reducing it back to 7.5 percent as it is today. But he understands the financial gap. And he knows this is something that had to be done.

"All his bluster and posturing is just another example of PLP duplicity."

In response to criticisms he and the Free National Movement have flip-flopped the VAT issue Mr Turnquest also said: "There is nothing shameful about changing your position based upon the facts as they change. There is nothing shameful about that. Who among us has not had a change of position once we find out some circumstances?

"I mean every time you wake up in the morning you put on a suit because I could tell you that I did it this morning. (I) put on my suit and then decided what tie I was going to wear and I had on the tie, then I decided I would change it because of the colour of my suit. It depends on the circumstance."

Well_mudda_take_sic 5 years, 10 months ago

The back-peddling that this incompetent idiot and the dimwitted Doc are now trying to do is truly pathetic. When the Christie-led administration misguidedly implemented the regressive VAT at 7.5%, they were at least praised for keeping zero rated and exempt items to an absolute minimum thereby creating a much more collection efficient and easy to administer VAT system, with low cost ease in auditing compliance by all VAT registrants. But now we see Turnquest and Minnis upsetting that apple cart in an effort to hand out candy in the form of VAT exemptions and zero rated VAT items that will add enormous complexity, inefficiency, leakages and noncompliance issues to what was otherwise a well designed taxation system, albeit a very misguided regressive one. These two bozos, Turnquest and Minnis, are flying by the seat of their pants without any regard for appropriate modelling and sensitivity analyses that should be subjected to proper vetting by leading VAT experts within the Bahamian private sector. What is now going on here in all the back-peddling is the absolute height of lunacy and insanity by two bozos hell bent on taxing us the maximum extent they feel they can politically get away with. And as for Marlon Johnson, he is so far out of his depth as Financial Secretary that he alone poses a most serious threat to the financial security of our nation. These three bozos, Minnis, Turnquest and Johnson, know not what great harm they doeth us and our country!

licks2 5 years, 10 months ago

Hahahahahahahahahahahahahahahahaha. . .doc ger gee you "da tissic" because you can't keep up with him there out maneuvering you all over the place. . .PLENTY OF US JUST GONE WITH HIM COS PLENTY PEOPLE DON'T HAVE TO PAY VAT ON LIGHT AND BREAD BASKET ITEMS. . .DUTY GERN DOWN ETC!! BOOYA. . .ROCING WIT DOC!!

Well_mudda_take_sic 5 years, 10 months ago

Now go collect your pay cheque from the dimwitted Doc. Hopefully it's not somehow drawn on The Public Treasury.

ThisIsOurs 5 years, 10 months ago

Wow. It never ceases to amaze. As was pointed out, all they have to do to compensate for that is raise the fuel surcharge. What should concern you more is that in three days theyve so casually backpedalled on multiple items, excluding this, reducing that, it must be ripping their revenue assumptions to shreds. further shows how little thought went into the original projections, they had no idea of the impact of introducing the tax and no idea of the impact of picking it apart piece by piece.

DDK 5 years, 10 months ago

The strange thing is, this Government, like almost all before them, never give any relief to the business community and seem quite content to suck it dry. Why they think the business sector, which usually has larger bills than the residential, is deserving of a higher rate structure on utilities, for example, is beyond me. Don't they realize that if the business and working class disappear there won't be anyone left to pay ANY taxes? Not rocket science! It had been hoped that if there were more elected politicians with business acumen the country would be run better. The trouble is, these phat katz are just too disconnected from the majority that elected them......

TalRussell 5 years, 10 months ago

Da comrade Imperial red shirts scrambling justification brungs value 12% VAT. Soon announce be no 12% on ya Knickers.

hrysippus 5 years, 10 months ago

This is great news for all those homes that can afford to invest in solar electricity generation.

TalRussell 5 years, 10 months ago

Ma Comrade, VAT added Light Bill “very tiny measured in Ants, grains of sand, and portion size compared to cost electricity. few surcharges, etc. Few, if any, have had their fridges turned off over failure afford VAT... so let's address lowering real costs.

ThisIsOurs 5 years, 10 months ago

What?? Please tell us where this world is where diehard FNM supporters live in but don't have calculators. 7.5% off of $200 is $15. In what world does $15 per month per you on the path to purchase solar before year 3218?

birdiestrachan 5 years, 10 months ago

The only thing these fellows are good at is telling LIES. They do not know what they are doing. they just blunder along,

birdiestrachan 5 years, 10 months ago

This Turnquest man is a serious fellow. he finds fault with MR: Davis because he will not committee to changing VAT. does he know Changes have to be implemented properly and it makes no sense to change the rates every few years.

Turnquest check yourself you fellows said that VAT was bad for the Bahamas. Then you come into power and increase the rate on something that you all said was DEAD wrong. same as the spy bill, BAR MAR and so many other things,

vlmarshall 5 years, 10 months ago

And do you realize that VAT was supposed to be implemented at 15% but was only introduced at 7.5%? Key word there is introduced....think about it. we can all put this discussion to rest...Using the freedom of speech that you praised just last week. Please give us your solutions to the current predicament that we find ourselves in financially as a Bahamaland.

ThisIsOurs 5 years, 10 months ago

First solution! please stop putting this arbitrary, completely unnecessary, three year, balance the budget timeline on us. That will solve 98% of the problem.

Porcupine 5 years, 10 months ago

Exactly right.

birdiestrachan 5 years, 10 months ago

What does killing the Bahamian the poor ones have to do with Turnquest suit. He sounds like the FNM woman on the house floor who talked about men beating their wives Apples and oranges. it makes no sense The Bahamian people have been betrayed, "THE JUDUS" Some believed the FNM Government was going to repeal VAT. They gave that impression by their utterances.

vlmarshall 5 years, 10 months ago

Birdie another round of drivel yet still not solution. Sadly, that's the majority of us, we just talk because we have a mouth, it doesn't matter that we have nothing of substance to say. As for thisis ours, the three year timeline is obviously based on the potential time limit in office considering the way we as Bahamians hold political grudges. The reality, is that they have a plan and a timeline which is better than I can say for past governments of both parties. Finally, a group is saying, we have to stop borrowing and here is a plan for it, albeit an unfavourable plan.

TheMadHatter 5 years, 10 months ago

"These duty-free provisions are to be facilitated by application as well and again that's because we want to ensure that the benefits go to those who we are trying to assist."

And he is VERY WISE not to say that "those" are the Bahamian people this time - so as not to roust the angst of the "well known" Q.C. :-)

bcitizen 5 years, 10 months ago

This is just smoke and mirrors. What happens when BEC can't net off their vat expenses and have to raise their base rates/fuel surcharge? We'll be right back to square one.

Porcupine 5 years, 10 months ago

Yep. A matter of when.

alfalfa 5 years, 10 months ago

KB. Time to start signing your "Jokey" song again. We gone backwards.

ThisIsOurs 5 years, 10 months ago

Told a friend today that this Minnis reminds me so clearly of Donald Trump. They create a big unnecessary crisis then sweep in to solve the crisis and their blind followers say see! Look how wonderful he is, I tell y'all, he's really looking out for us, good job. @licks.

vlmarshall 5 years, 10 months ago

I'm still waiting to hear the other solutions that will help us to get out of the current debt that we are in.

sheeprunner12 5 years, 10 months ago

Just go online and read the Budget .......... Thats a start.

63,000 Bahamian households have a <$200 monthly light bill ...... That is who will save ........

This will motivate people to conserve electricity now.

ThisIsOurs 5 years, 10 months ago

It's $15 per month @sheeprunner, for those with bills under $100 it's $7.50.. It's "something" I guess. Like I said before, another Trump move, create chaos so you have something to solve. Super Mnnis.

@vlmarshall As to a solution I was quite serious before. Remove the arbitrary unnecessary artificial three year timeline. It's like the woman who starts dieting and exercising so she can lose 50 lbs for the wedding in two weeks. She "could" do it, but she "will" end up in the hospital, either from unnecessary stress or symptoms of starvation. A much better realistic goal is 50 lbs in 52 weeks. One lb per week.

Dawes 5 years, 10 months ago

Well a max of $24 once the rate goes up, but thats the most it can be. Still better then nothing. Unfortunate for most of the year it will be nothing for me.

TheMadHatter 5 years, 10 months ago

Sheeprunner? What do you mean read it online? Where? The cabinet nor this newspaper have provided any link to the budget. Govt secrecy continues as usual.

Have they? I may have missed it. Im not perfect (very close, but not).

Does anyone have a link?

ThisIsOurs 5 years, 10 months ago

Just search for "Bahamas national budget" you'll get it. I pasted it, but it disappeared.

vlmarshall 5 years, 10 months ago

@ thisisours, if the current government is unable to get the budget balanced in this term do you think they will be voted back in for another term to continue working towards balancing the budget? the timeline is necessary that's the point of having a goal, setting a time to complete it.

ThisIsOurs 5 years, 10 months ago

that is so nonsensical it's almost unbelievable. ALL and I mean ALL of the experts are telling you, while balancing the budget is a worthy objective, your three year timeline is overly ambitious and could throw the country into a tailspin. It's unnecessary. BUT you've actually uncovered what I believe is the real rationale behind it, election campaign slogan.

Listen, this is not the books for you million dollar company. This is a country.

Sign in to comment

Or login with:

OpenID

The Tribune