By KHRISNA RUSSELL

Deputy Chief Reporter

krussell@tribunemedia.net

FINANCE Minister K Peter Turnquest defended the government’s decision to increase taxes on gaming house operators on Thursday, saying it is only fair web shops pay “their fair share” for its impact on vulnerable communities.

He appeared to suggest that as Bahamians were “given the short end of the stick” when web shops were legalised despite their “no“ vote in the 2013 Gaming Referendum, operators should be heavily taxed.

However, he insisted the government tried to strike a balance to be fair to the operators and to Bahamians, adding in other regions gaming houses were taxed as high as 80 percent.

During his budget presentation on Wednesday, Mr Turnquest revealed new fees on web shops. Patrons also will be charged a five per cent stamp tax on in-store deposits and non-online games/digital sales.

The government is also proposing a new stipulation regarding unclaimed winnings and dormant accounts, through the Gaming House Operator Amendment Regulations, 2018.

Where a patron fails to claim any winnings not deposited into an account within the time stipulated by the licence holder or where no time is stipulated by the licence holder, within three months, the winnings will be forfeited and the licence holder will have to turn the winnings over to the Gaming Board.

In addition where an account held by a player or patron becomes dormant, the balance of the funds on the account will be forfeited and the balance of the account given to the government.

An account is considered dormant in instances where there is no activity for 12 months.

Regarding the Minnis administration’s decision to impose new taxes on the industry, Mr Turnquest said: “With respect to this industry itself as you all know the Bahamian people voted a particular way with respect to this industry. Nonetheless it was allowed to proceed.

“It was allowed to proceed in a way that the Bahamian people were given the short end of the stick if you will.

“In other regions the amount of tax that is generated from the gaming industry is as much as 80 per cent. We have tried to strike a balance to be fair to them and be fair to the Bahamian people.”

He continued: “There is a call for instance for us to establish a national lottery. We don’t necessarily want to get into that business, but we recognise that it is a valuable business that has the ability to generate revenue for the Bahamian people such that we can invest in cultural activities and sporting activities and education. The fact of the matter is that to date the wealth has been amassing accumulating in the hands of a few people.

“We believe given the effects that gambling has had on societies, particularly vulnerable family islands that it is only fair that they pay their fair share and contribute to the social well being of the Bahamas as much as the Bahamian people have empowered them.”

“We are not targeting them or trying to destroy them. What we are saying is that you have to make a social contribution particularly to those communities that you are pulling so much from and I think it’s only fair.”

The new "sliding scale" tax structure for the revenue earned by the operators themselves involves rate increases ranging from a low of 81 per cent to a high of 355 per cent compared to what the sector currently pays.

The proposed rates are:

• Up to $20 million in revenue, a rate of 20 per cent.

• Between $20 million and $40 million, a rate of 25 per cent.

• Between $40 million and $60 million, a rate of 30 per cent.

• Between $60 million and $80 million, a rate of 35 per cent.

• Between $80 million and $100 million, a rate of 40 per cent.

• Over $100 million, a rate of 50 per cent.

The present tax structure requires web shop operators to pay 11 per cent on taxable revenue, or 25 per cent of EBITDA (earnings before interest, taxation, depreciation or amortisation), whichever is greater.