Bran: Bahamas must ‘open up for business’

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Democratic National Alliance’s (DNA) leader yesterday urged the Government to “open the Bahamas for business”, warning it would be unable to “tax its way out of debt”.

Branville McCartney warned that the Christie administration’s “desperation for revenue” was threatening to further burden an already-stretched private sector with more compliance bureaucracy and red tape.

“They are desperate for revenue, and they are taxing the Bahamian people to get out of their debt,” the DNA leader told Tribune Business. “You cannot tax your way out of debt.

“This Government should look at managing the country better, reduce the wastage, eliminate the corruption, diversify our economy and make the Bahamas open for business, and allow for doing business to be easier and efficient as opposed to being a turn-off for locals and foreigners.”

Mr McCartney was speaking after Tribune Business revealed several of the enhanced tax enforcement/compliance measures proposed by the Government in association with the 2016-2017 Budget.

Apart from shortening the ‘window’ for VAT payments by a week to 21 days, the Christie administration is also proposing a much more stringent filing regime - and penalties - for the shipping, importing and courier sectors.

The Government also wants to “adjust the requirement of the Tax Compliance Certificate” to cover major shareholders in a company.

This means that all shareholders owning greater than 20 per cent of a firm’s equity will also need to be fully paid-up with their taxes for the company to obtain a TCC.

And, in a bid to ensure group affiliates and subsidiaries are also compliant, the proposed Financial Administration and Audit Act amendments also extend the TCC requirements to cover “companies with similar shareholders”.

Then there is the Government’s move to enforce compliance with Budget reforms enacted last year, with companies now required to produce a Tax Compliance Certificate (TCC) to obtain payment for goods and services ALREADY supplied to its agencies.

Companies now have to prove they are compliant with all their taxes by submitting a TCC prior to receiving payments on public sector contracts worth more than $10,000. With TCCs only valid for one month, businesses face having to prove their ‘good standing’ every month to receive payment.

Many in the private sector are viewing this as regulatory overreach or overkill by the Government, and symptomatic of its desire to collect every cent of revenue due.

And, in so doing, it will further cripple the ‘ease of doing business’ and burden Bahamian companies with unsustainable compliance and administrative ‘red tape’.

K P Turnquest, the Opposition’s finance spokesman, told Tribune Business: “It indicates that the Government is having some tremendous challenges from a cash flow position.

“I think they have some serious issues, and are trying to desperately find money from everyone and everywhere, not necessarily thinking it through. It is so counter-productive.”

The Bahamas’ national debt is more than $6.6 billion and continuing to increase, although the growth rate - and size of the fiscal deficit - has decreased since Value-Added Tax (VAT) was introduced on January 1, 2015.

However, the Government has found GDP growth and cutting its spending - two of its four key ‘fiscal turnaround’ goals - more elusive.

It recently cut real GDP growth estimates for the Bahamian economy to 0.5 per cent for 2016, following a 1.7 per cent contraction last year.

Comments

Reality_Check says...

The corrupt Christie-led PLP government has sucked the "non-politically connected" private sector businesses dry of financial resources as part of its social welfare campaign aimed at buying votes at any cost by making voters dependent on government jobs, government handouts and government concessions of one kind or another. Bottom line: Lamed-brain Christie and his loyal buffoons are ignorant corrupt imbeciles totally incapable of formulating and executing on national economic policies that would create well paying private sector jobs that in turn would result in an expanded tax base to lessen the tax burden on an already severely over-taxed "non-politically connected" private commercial sector. It's really all as simple as that!

Posted 8 June 2016, 4:44 p.m. Suggest removal

bogart says...

Absolutely true that sources of financing and revenue is more challenging. To invite businesses govt offers incentives to compete with other Caribbean countries, businesses come Bahamians are employed. Bahamians then go to Banks which have foreign offices decide, manage, regulate loans to various extent and make profits which leaves the Bahamas. At the end of the day we have lots of defaulted mortgagors, second hand foreign cars etc. What is needed is a really serious examination of the Banking system from the processes of control, marketing and development of our nation. Start with getting a Committee to investigate why 4,500 Mortgagors are in default and tying up almost a Billion dollars in loans. Look at the loan policies which caused this etc. Any sacrifices in giving incentives/birthright to open up for more business must have benefit for Bahamians and beneficiaries and not more misery.

Posted 10 June 2016, 8:16 a.m. Suggest removal

isabella says...

If there are good business opportunities around then they should not waste any more time. Manufacturing plants should also be launched here which must be fully equipped to use latest <a href="http://www.vtcmag.com/showcase/">vacuum technology</a>. Growth of business will eventually lead to financial success.

Posted 22 June 2016, 6:32 a.m. Suggest removal

karina says...

In order to attract the investors here, they first need to create a positive business friendly environment. There are several factors to be taken care of before launching any kind of business. Now most business owners prefer making their products and services available online. For example, you can find the leading custom tape printing company Continental Tape Printers online in an instant at <a href="http://www.continentalpackaging.com/">http://www.continentalpackaging.com/</a>.

Posted 27 July 2016, 3:31 a.m. Suggest removal

Log in to comment