The Tribune

By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

A leading trade union body says it cannot support 7.5 per cent Value Added-Tax (VAT) as proposed because it is inequitable, while agreeing that the Bahamian taxation system needs reform.

Trade Union Congress (TUC) president, Obie Ferguson, told Tribune Business: “Our position is that we don’t support that. We never told the Government that we support VAT.

“If VAT is going to have an impact on the little man, how can we support that? If the little man is going to bear the burden most, we can’t support that. I want taxation that is going to be fair and equally distributed to all players.”

Mr Ferguson added: “You can’t introduce that to the little man and expect me to agree with that. I represent the little man. We don’t support it in its present form. If they can revise it and show how it can be more fairly distributed, certainly we would consider it.”

Prime Minister Perry Christie announced during his 2014/15 Budget communication that VAT will be delayed until January 1, 2015, and introduced at a rate of 7.5 per cent instead of 15 per cent.

Mr Christie said there will be one single VAT rate across the board (other than a zero rate for exports), and that the Ministry of Finance is proposing fewer exemptions. Minister of state for finance, Michael Halkitis, recently said the draft VAT Bill and accompanying regulations will be released before end-July.

“There needs to be some form of taxation. I have no difficulty with that,” said Mr Ferguson.

“I have a difficulty when you are trying to do it and the majority of the taxes are going to be on the little man. I have a problem with that, that is not right. We cannot support that. There needs to be fairness.”