The Tribune

By MALCOLM STRACHAN

AS Bahamians continue to wrap their minds around the dramatic increase in what was already one of the highest costs of living in the world, the outlook is daunting. The government, unabashed by dissenting views inside and outside Cabinet, has shot down any hope of the VAT rate being decreased a few points before its July 1 rollout.

Prime Minister Minnis doubled down on the government’s decision to increase VAT from 7.5 percent to 12 percent, saying it was the right decision.

He said: “We looked at 15 percent. That was not an option. It was too much pain for anyone to burden. And we looked at 12 percent, (and) we realised there would be some challenges even with 12 (percent), but we know how to overcome those challenges, and therefore we had to increase to 12 (percent) so as to protect future generations.”

We are still unclear as to how the government came to the conclusion that 12 percent VAT was the most sensible option from a technical standpoint. Although Deputy Prime Minister Peter Turnquest and Financial Secretary Marlon Johnson have been making the press rounds, they’ve yet to present a case convincing enough to help the Bahamian public see why it was necessary to increase VAT to 12 percent in order to balance the budget in three years.

Unfortunately, the reality is that there is no sense in crying over spilled milk at this point. The government is not going to save the day as they promised us over a year ago. While balancing the budget may be a laudable accomplishment on the part of any government, it shows a lack of understanding of the struggles of the Bahamian people.

Even going through the budget presentation and looking at the exemptions that are going to be granted, it simply does not add up to anything resembling a benefit.

All that being said, when the rubber meets the road, the Bahamian people will have to adjust their lives to their new economic environment. The new challenges will stretch much further than the economy.

Certainly, the citizenry will benefit greatly in developing a greater sense of financial literacy and learning how to make their money work for them. That will undoubtedly be the most tangible effect that we will experience. However, we must also take into account how we will be affected socially. Moreover, we will also need to consider how this affects us politically.

We can say with assurance that some families are going to suffer. Those families that struggled to make it before VAT’s first implementation are going to be suffocated under the new increase. Notwithstanding exemptions on breadbasket items, everyday expenses for all Bahamians will increase.

Consumer goods that are not included in the breadbasket may likely increase in price with operators trying to maintain profitability. Without a doubt, the customer – you and I – are the ones that will feel the brunt of the government’s decision.

If we look at the announcement from two gaming operators to close shop on certain locations and trim staff – whether you love or hate the numbers industry – those are Bahamians that are about to be unemployed.

Let’s face it – had getting a job been an easy feat, unemployment would not be sitting at around 12 percent with projections pointing to future increases. While the general public’s angst toward the legalisation of the numbers industry may be justified based on the circumstances it took place, the undeniable fact is the industry is legal.

The operators all have gaming licences. They all pay taxes and are not opposed to a fair tax increase. They all employ Bahamians that contribute to the circulation of money within the economy.

The perpetuating of arguments that the number bosses “have too much money”, “they have made their riches” or “they pay their staff low wages” all hide the fact that the government arbitrarily made a decision that will affect average Bahamian citizens. The government has no safety net in place to cushion the fallout when these businesses – as any business would when economic conditions dictate – decrease operating costs. Unfortunately, the first cost to cut is usually payroll.

Rather than having empathy for our brothers and sisters, far too many Bahamians are expressing hatred towards the numbers bosses. Instead of appealing to a sense of innate care we should have for our fellow man, some of us disregard how this will affect people in the inner city and family island communities where prices are already high.

Amazingly, we are still a place where people would still jump off a cliff over political biases. And resultantly, our leaders indiscriminately make decisions they deem fit without fear of upheaval.

Consequently, the challenges facing us over the next few years are monumental.

The government’s plan is to be able to tell the Bahamian people that it has balanced the budget and saved the country for future generations. Likely, the Opposition will campaign on the pillar that the government has sacrificed the current generation to save future ones.

The mudslinging will no doubt be as entertaining as “silly season” always is, but at some point, the pain and suffering has to bring us to a place where enough is enough.

The Bahamian people believed that the Minnis administration would be a different one. Though he claims he is trying to “save The Bahamas for future generations”, he is doing so arrogantly – leading in a vaccum.

How are we, the Bahamian people going to save our own generation? The prime minister never consulted us on “saving us”. Nor does he have the sole authority to decide when and how we ought to be saved.

The people of The Bahamas must raise the level of leadership, or that, my friends, will be the real determinant in our success or failure as a nation – not national debt. Visionless, stubborn, arrogant leadership is what will drive away local talent and suppress leadership ambition in this country as people become more hopeless.

As a nation, we face some difficult times ahead. Hopefully, this is able to bring us together where we are able to find strength in unity and a shared responsibility to make The Bahamas the best little country in the world.