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Pm Promises Dorian Tax Breaks Extension

Prime Minister Dr Hubert Minnis.

Prime Minister Dr Hubert Minnis.

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Prime Minister last night promised Abaco that he will extend Dorian-related tax breaks beyond their 2021 year-end expiration as part of efforts to “accelerate” the island’s rebuilding.

Dr Hubert Minnis, at a party rally in the central and south Abaco constituency, said he would create the Extended Disaster Recovery Programme if re-elected to office while making multiple pledges in his bid for success on September 16.

“We remain determined to ensure Abaco is again one of the most vibrant economies in The Bahamas. In our new term, we are going to create the Extended Disaster Recovery Programme for Abaco. This programme will apply to the hardest hit areas of Abaco.

“At present, the concessions available under the Special Economic Recovery Zone have been extended to December 2021. The Extended Disaster Recovery Programme will include a further extension of the special economic recovery zone concessions.”

Long-term certainty over how long Dorian tax breaks will last has been a major cry from Abaco’s private sector for months. Ken Hutton, Abaco’s Chamber of Commerce president, earlier this month had urged the Government - and especially the administration that is elected to office on September 16 - to fully commit to seeing Abaco’s rebuilding through to completion.

And he had also called on the the Government to enact existing VAT relief and other Dorian-related tax breaks for the long-term beyond their year-end expiry, arguing that this would spur greater confidence and investment by both businesses and homeowners.

“It’s hard to make long-term plans on a six-month basis,” Mr Hutton told Tribune Business then. “When the storm first happened we were told a three-year programme would be put in place, but then when COVID-19 hit it turned into a rolling series of three to six-month extensions.

“To encourage investment and rebuilding there needs to be a longer window. You cannot get anything done in six months. We need the certainty of another three years minimum. Assuming that can happen, the revenues generated by Abaco will more than make up for any kind of concessions given in the short-term.”

Promising that an FNM government would seek to partner with the Abaco Chamber on these and other initiatives, Dr Minnis detailed the investment that has been made by state-owned utilities in restoring the island’s infrastructure following the catastrophic Category Five storm that hit in early September 2019.

“Over the last two years, BPL (Bahamas Power & Light) has replaced some 4,000 transmission and distribution poles; installed 2.6m feet of overhead conductor wire; and installed 15 temporary generators and repaired three of the island’s primary generators,” the Prime Minister said.

“As the distribution system has been wholly repaired, any customer on mainland Abaco or the cays who wishes to connect to BPL power can do so provided they have the requisite approvals from the Ministry of Works. BPL has spent $61m so far in the Dorian reconstruction effort, much of that money in Abaco.

“In August 2019, BPL had around 9,100 customers on the grid. By September 1, 2021, BPL had been able to return just over 5,700 customers – roughly two thirds – to service. There remain a high number of customers still in various stages of reconstruction of their homes. Nonetheless, we are receiving a steady stream of applications and are connecting roughly 100 customers per month.”

Dr Minnis also affirmed plans to construct a new Marsh Harbour port via a public-private partnership (PPP) - another priority identified by Mr Hutton. “The Marsh Harbour port is even more critical [than the airport] in the opinion of the business community because that is our lifeline,” he told this newspaper previously. “I’m at the port every day, and nothing has been done since July. We’re very concerned.

“The solutions are there, the solutions have been submitted. Solutions are on the table that have been provided to solve this particular problem. Whoever takes charge after the election, this needs to be an absolute priority of the Government. The Abaco Chamber is willing to help in any way.”

Unless this is addressed urgently, the port’s ongoing post-hurricane waiver from having to comply with global maritime security standards implemented after the September 11, 2001, terror attacks could be in jeopardy.

If the present exemption from the International Shipping and Port Security (ISPS) standard is discontinued, it would result in vessels bringing in reconstruction and daily supplies to Abaco being unable to return directly to the US.

Such a development would force these cargo vessels to instead offload their goods in Nassau or Freeport rather than Abaco, resulting in increased costs and extra time to get vital products to homeowners and businesses still rebuilding their Dorian-ravaged properties, thus stalling the reconstruction efforts.

Senator Dion Foulkes, minister of transport and local government, earlier revealed that the Government was exploring a PPP arrangement to revive Abaco’s main shipping port, with private capital and development/management expertise sought to oversee this process.

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