Deputy Prime Minister Peter Turnquest and Chester Cooper, MP for Exuma and Ragged Island.
THE Minnis administration is “cautiously optimistic” it will meet its fiscal targets for the year after the deficit declined 50 percent in the first quarter and revenue increased, Deputy Prime Minister and Minister of Finance Peter Turnquest said in a statement yesterday.
The data, however, points to potential headwinds, according to Progressive Liberal Party Deputy Leader Chester Cooper who said value added tax collections for the quarter are “significantly below budget”.
VAT revenue brought in $199.4m, up 19 percent for the quarter, according to information from the Ministry of Finance.
“My contention is that the VAT revenue is up by 19 percent even though they increased the rate by 60 percent,” Mr Cooper told The Tribune, saying the numbers raise red flags even when accounting for seasonal fluctuations in revenues. “They would have to do a monster second quarter to make up for that short fall. I don’t believe they will.
“We maintain that the so-called expert modeling and massive tax hike itself were ill-advised,” the shadow finance minister said in his statement.
For his part, Mr Turnquest said “performance reporting is not about popping champagne when we are happy with our progress and burying the numbers when we are not.”
He added: “Performance reporting is about full disclosure. It is about upending the culture of closed government and prompting transparency instead.”
This is the first time a quarterly budget performance report on the government’s revenue, expenditure and financing operations has been presented to the public.
“It aligns with global fiscal disclosure standards and best practices,” Mr Turnquest said.
“In the Ministry of Finance, we are proactively working to set a new model for good governance: from the ground up, we are building a culture of openness, access to information and engagement, which is what the public demands and expects. We all know that change takes time, especially within large bureaucracies, but each small step we take in the right direction is cause for encouragement. The launch of quarterly performance reporting is certainly a step in the right direction. The government has a big reform agenda and this is another step forward in fulfilling same.”
The Ministry of Finance also revealed the country’s deficit, which measures the amount by which government spending exceeds revenue, was cut by $56.6m compared to the 2017 fiscal first quarter performance - falling from $108.6m to $52m year-over-year.
Comments
John 5 years, 5 months ago
‘VAT was increased by 60% but the VAT revenue was only up by 19%.’ Talk to any business owner outside food stores and they will tell you that sales are down by as much as 30%. And business license fees are down bro confirm this. Increasing taxes when there is no real growth in the economy and consumers were already spending all their disposable income means the new tax money has ty come from some where. And so if spending continues to decline in the next quarter, government will not realize the increases in revenue it anticipated. Then come January, business license fees will also decline, not only because there will be store closures but businesses still in operation will be generating less revenue. And these two ‘winter’ quarters should be the time government should be seeking to maximize its tourism and revenue to external sources. To seek more tax incu in the short term will definitely kill the economic goose.
Bonefishpete 5 years, 5 months ago
So they should of started the VAT at 15% as planned. Just blame Christie for caving in. Problem solved.
watcher 5 years, 5 months ago
Anyone still remember the original reason for VAT? You know, to pay down the debt. Not only has all the VAT revenue been wasted by both governments, but they also need to increase the rate to pay for .....errrrrr....... anything but the debt.
John 5 years, 5 months ago
The original reason for VAT was tax reform where customs duties and stamp taxes would be replaced by VAT in preparation for membership in the World Trade Organization. The WTO considers customs duties barriers to trade. But rather than eliminate Customs duties or gradually reduce them as VAT was introduced, then increased government kept both taxes running simultaneously. So imagine when customs duties are totally eliminated. VAT may have to go to 25% for government to realize the current level of revenue. Especially if they do not grow the economy.
licks2 5 years, 5 months ago
Carry ya lazy self and read them news papers them. . .yes. . .even the journal. . .the business sections show that yinna deficit is down by 50%. . .and VAT increase is only by 19% so far!! You issa PLP aye?? Yinna don't like to read anything that een gat a yellow cover hahahahahahahahahahahahahahaha!
proudloudandfnm 5 years, 5 months ago
So the entire country is falling apart but VAT collections are up......
We are a dumb country.....
John 5 years, 5 months ago
It is like a vehicle on the side of the road that has run out of gas. Rather than send to the gas station for gas, you take the last money you have and pay someone to wash the vehicle.
John 5 years, 5 months ago
The comment above was not intended for the current government. Many believe that Hubert Minnis is sincere in his efforts to set this toppled government right side up again and reduce its Humpty Dumpty (Gussimae) size to one that is more fit and trim. And sometimes we grow impatient and forget how difficult and drawn out the process is. Financial problems really started in this country in 1973, when governments were giving away everything of value to foreigners and borrowing like a drunken sailor. even as a schoolboy one could not figure out (back then) why so many concessions were being given to hotels to accommodate tourists, to establishments that entertained them, and to cruise and airline companies who brought them here. Bahamians, who were barely surviving, were subsidizing the vacations of tourists. And millions, ok, billions were being borrowed. Now the chickens have come home to roost. And only Bahamians here to feed em.
tetelestai 5 years, 5 months ago
John, your overall point is well taken. However, just for your edification, the concessions policy that exists today is actually a relic of Sir Roland Symonette/Sir Stafford Sands, et al (well before 1973). Pindling merely continued with what was in place. Even the most sycophantic UBPs/FNMs/PLPs agree on this point. In fact, new-FNMs (read: old UBPs) still like to rattle the cages of the PLP by reminding them that, despite the claim of independence and a better day for Bahamians, we (i.e. The Bahamas) still utilize one of the UBPs primary policies. Though I take your point that the policy should be revisited and even abolished, if necessary.
TigerB 5 years, 5 months ago
So what I'm hearing under the last administration we beg to find out where the VAT money went.. now under this government we know where it went and we still not happy, maybe they should do like the last government... don't say a word!!!
licks2 5 years, 5 months ago
This the person who want to run this nation with BD? Talk about dumb and dumberer. . .I gern ta kick rocks. . . I wonder who painting they house now.
The_Oracle 5 years, 5 months ago
And that is the sign of economic constriction. VAT increase added to the threatened Heath Insurance TAX (make no mistake, the compulsory "contribution" that by their own words "shares" the burden. creating uncertainty/ instability seems to be their forte.
licks2 5 years, 5 months ago
Economic contraction is a decline in national output as measured by gross domestic product. That includes drop in real personal income, industrial production and retail sales. It increases unemployment rates. You mean eco. contraction. . .not constriction. . .which you cannot be right because IMF, with the same information you are using, predict 2.52% increase. . . this fiscal period! The creation of instability is in the heads of some op-posers. . .and of course Tal, bird and the PLP!!
sheeprunner12 5 years, 5 months ago
Will this be the focus of the so-called FNM Conclave this weekend????? ........HMMMMMM
Fish .......... cut bait ......... or get the hell out the boat (to quote SLOP)
licks2 5 years, 5 months ago
Hahahahahahahahahahahahahaha. . .organizations does have them "conclaves" . . . or should I say "night of the long knives" meetings? But I say "lee them fellas dem alone". . .them fellas dem providing "fire under they boongy" services. . .services the PLP can't provide. But we know what the meeting is all about. . . but "runnin them" outta the party will look lame and petty!! Every man is free to speak. . .free to make an ninny of himself. . . get petty if he likes. . .BUT LET HIM SPEAK!!
licks2 5 years, 5 months ago
Hahahahahahahahahahahahahaha. . .organizations does have them "conclaves" . . . or should I say "night of the long knives" meetings? But I say "lee them fellas dem alone". . .them fellas dem providing "fire under they boongy" services. . .services the PLP can't provide. But we know what the meeting is all about. . . but "runnin them" outta the party will look lame and petty!! Every man is free to speak. . .free to make an ninny of himself. . . get petty if he likes. . .BUT LET HIM SPEAK!!
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