By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Government was yesterday urged to crack down on “out of control” roadside auto vendors, a leading dealer estimating they now accounted for 40 per cent of the total market.

Fred Albury, the Bahamas Motor Dealers Association’s (BMDA) president, told Tribune Business he had already submitted recommendations to the newly-elected Minnis administration on how it could create “a level playing field” for all auto market participants.

He added that the suggestions would also benefit the Government, which was losing “considerable” revenue from the proliferation of roadside auto vendors who did not pay the likes of Business License fees, real property taxes, VAT on sales and National Insurance Board (NIB) contributions.

Mr Albury said the recommendations included his previous call for a vehicle import licensing system which, while allowing Bahamian consumers to import used cars, would identify those bringing in multiple vehicles and likely using the trade as a business.

He also called on Customs to certify wrecked vehicles at the point of importation, so that Bahamian consumers, insurance companies and banks were properly protected and new what they were purchasing.

“The biggest pressing issue is this uncontrolled proliferation of unauthorised, unlicensed brokers importing used cars into this market,” Mr Albury blasted to Tribune Business. “It has depressed the market considerably because it is heavily saturated, and the Government is making little to no revenue from it.

“If you go down to West Bay Street by Perpall Tract, - I call it ‘West Bay Auto’ - I counted 10 vehicles before I got to Ferguson Road. They’re at Montagu, all the roundabouts and anywhere there is a vacant space. They pay no Business License, no NIB, no VAT and no property tax. It has gotten out of control.

“If you check with United Shipping, which is the agent for cars coming in from Japan, R. H. Curry and Inchcape, a boat came in the other day with 500 used cars. Another boat had come in the previous week with 300 cars, of which only 50 were new. I’d like to see something done.”

Describing the issue as “priority number one” for himself and the BMDA, Mr Albury said the revenue loss to the Government from the proliferation of roadside auto vendors was “well into the millions of dollars”.

“New car sales are down to 1,600 units a year, compared to 4,500 units in 2008,” the BMDA president told Tribune Business. “If we’re able to get that number back up to 3,000 units, do something about the age limits of used cars and somebody and enhance the regulations, whatever the Government is getting from used car sales now they could double.

“I’m paying between $500,000 to $800,000 a month in duties. If they could double that from me alone in duties, and whatever they get from used cars, they’d be well on their way to enhancing revenue.”

Mr Albury estimated that used cars now accounted for 80 per cent of all autos sold in the Bahamas, with unlicensed roadside vendors enjoying a 50 per cent share of this - giving them a total market share of 40 per cent.

“It’s got so bad that, going home one night a few weeks ago, there were four used cars coming off the Arawak Cay port with four expatriate guys, Pakistanis and Indians, driving,” he disclosed. “You’ve got expatriates in here on work permits bringing in cars, and selling them at the side of the road.”

Mr Albury said this presented unfair competition to himself and other BMDA members, as roadside vendors were able to undercut them on price by not having to carry the overhead, staff and taxation costs of established dealers with a physical presence.

The BMDA president emphasised that he and his members were only seeking “a level playing field”, and that any regulatory measures also had had to protect the interests of Bahamian consumers.

“We’re offering simple solutions. They [the Government] need to level the playing field without stepping on the toes of consumers who want to import a vehicle for their own use, and take out the ones in business,” Mr Albury told Tribune Business.

He said the BMDA had recommended to the Government that it introduce a system where Bahamians needed to pay for, and obtain, a license to import a vehicle. Drivers licenses and NIB smart cards would be used to verify identities, and persons limited to importing one vehicle per year.

Mr Albury said this would immediately identify persons importing multiple vehicles for use in a business-type operation, who could then be required to provide Taxpayer Identification Numbers (TINs), evidence of VAT, Business License and NIB requirements, and a physical location.

This would effectively require roadside vendors to formalise their business, and Mr Albury added: “The guys in business now have to do the same thing I’m doing. There has to be some control at the border.

“I know the Government has to look after the small man, but we are the business places paying their taxes, rather than the informal vendor showing up on the side of the road and selling from there.”

Mr Albury also called on the Minnis administration to better protect Bahamians by improving the regulation of wrecked vehicle imports, suggesting one left the Arawak Cay port at the rate of one an hour on the back of a wrecker.

“We have a new Road Traffic system in place where they are titling vehicles,” the BMDA president explained. “With a salvageable vehicle coming in to be rebuilt, Customs can issue a certificate so that when go to Road Traffic, insurance, they know it was a wrecked vehicle.

“In the US, if you have a vehicle that is damaged and sold to salvage, it’s titled as such, so the consumer is protected; they know what they’re buying, the insurance company knows what they’re insuring and the bank knows what they’re lending money on.

“If you take out the profit punch it slows down, and consumers will be protected. These are solutions that will definitely change things considerably.”

Mr Albury said he and the BMDA had submitted their recommendations to both the former administration and now the Minnis-led government. While the new administration had been given just three weeks to prepare the 2017-2018 Budget, he expressed hope that some of their reforms could be acted on by the mid-year Budget next February.

“The door is open for conversations on it,” the BMDA president added. “They [the Government] know what the issues are. It’s up to them.”