The Tribune

EDITOR, The Tribune.

In order to understand the backwardness of certain opposition politicians, who reflexively oppose progressive tax reform, one has to put into perspective what they are actually advocating and defending.

Aside from a lunatic far-right fringe, there is no argument among economists and policy-makers worldwide that taxes on consumption (like duties and VAT) disproportionately affect the poor, while those on income and property help to spread the burden and reduce the inequalities of capitalist societies. That is why every major capitalist country on earth has opted to raise revenues predominantly from income taxes.

There is also no argument that The Bahamas stands out as the only independent country in the Americas and one of a handful on the planet that levies no taxes on income, instead deriving some 80 percent of its revenues from consumption taxes mostly on the poor.

Of the few others without income taxes, most are oil producers. That leaves us in the company only of Somalia for purposes of direct comparison.

The resultant distortion hides the impressive level of genuine wealth in our country by essentially redistributing it from the poor and the middle to the rich. It also retards growth, because poor people are the most reliable consumers in the domestic economy, while rich people simply hoard.

If all that sounds like stupid policy, that’s because it is. And it only stays that way because we have had too many politicians who either don’t understand these basic issues or simply don’t care.

ANDREW ALLEN

Nassau,

June 1, 2023.