Based on how the Minister has phrased the corporate tax communication I would assume that by the end of FNM's current term in office some form of corporate/income tax will have been implemented.
The communication is just the first shock to soften up the general public. Similar to how the PLP implimented VAT and legalized gambling.
Bahamian citizens, permanent residents and foreigners are therefore on notice to get their affairs in order.
Some considerations and questions left wide open by the Minister during his most unhelpful communication.
1. Are we talking a corporate tax or an income tax. There is a big difference as a corporate tax does not impact individuals.
2. Are we talking a corporate tax on Bahamian companies resident for exchange control purposes or does it include non resident companies which are used mostly by foreigners and residence e.g. IBCs.
3. Are we talking a corporate tax on domestic earnings (local businesses) or will it include international businesses (or world wide income).
4. Are we talking a taxation based on underlying beneficial ownership (citizenship tax) or on the "place of doing business" or residency? How do you determine residency for tax purposes. Eg. In the US if you are a non resident and you are in the US for less than 120 days then you are not deemed to be resident for tax purposes. The US taxes on world wide income.
5. Will the corporate tax include passive financial income such as capital gains, interest income and dividends or will it be earned income from a trade. If it is from a trade does it only touch upon a trade performed in the Bahamas?
I can go on and on with many other queries. But to be safe we should assume that the government (as it did with VAT) will cast the widest net and then close it when the foreigners/non resident companies start to migrate to Cayman or the BVI (those that have not already done so) and the Bahamians start to scream.
We should also assume that the Business license fee will remain. So Bahamian business will be taxed on the top line (business license), on the bottom line (income tax) and on every transaction in between (VAT).
The Tribunes article probably has already been circulated to the Head Offices of many international companies that have IBCs subsidiaries in the Bahamas and I would assume they would start making contingent plans immediately.
While Bahamian will "consult" with the government and get into all sorts of arguments the foreigners will start to move now.
Did you notice people working on the roads on holidays and weekends but ya can't see dem workin during da week. Das cause during da week dey do'in dey own work.
Now dat da government dem pay'in dey ga just work satday, sunday and holiday.
Government dem borrow $750 million....come and get it....
Maybe the reason people are sending in old bills is because the government appears to be paying all of them. I guess the PLP stop paying bills so the people stopped sending bills.
But now that KP is in charge and paying bills then everyone is digging up all kinda old bills and KP ga just keep pay'in dem.
Get the word out KP pay'in old bills...hurry send dem in.
Where dey tink dey go'in drillin fa oil wit $1 million dollars? WTF? Dis company has been loosing money since it was formed (over $1 million a year), never made a dime in its life.
When da oil spill and mess up da Exuma sea park like BEC mess up Clifton who ga pay?
Poor black ignorant Bahamians, das who. Wake Up Bahamas!
Share price has collapsed from over $40 to under $1. Looks like a penny stock to me. No worries, just what the Bahamas needs. Another broke a#s foreigner investing in the Bahamas. Let roll out the red carpet to them.
Brian, you have well articulated that there is massive overregulation but you have not give one single solution.
Maybe because the protected legal profession charging 2.5% on every land transfer, or the complete lock out of foreign lawyers, or the exorbitant cost of $5,000 lawyers charge to incorporate a company when it can be done online in the states for $150. Sounds like a business crushing cartel to me.
Here are some more monopolies you can break up to get business moving again:
what about the money stolen through the monopolistic importation of all fuel into the country?, what about the 20 year Arawak Container Port monopoly over charging Bahamians? What about the exchange control cartel fee to convert funds of 1/2%? What about the BEC monopoly of extremely high prices? What about the shut out of solar and wind energy?
The economic system is dysfunctional. One bad hurricane across Nassau and the house of cards falls apart.
Ok, but what about the money stolen through the monopolistic importation of all fuel into the country?, what about the 20 year Arawak Container Port monopoly over charging Bahamians? What about the exchange control cartel fee to convert funds of 1/2%? What about the BEC monopoly of extremely high prices? What about the shut out of solar and wind energy?
The economic system is dysfunctional. One bad hurricane across Nassau and the house of cards falls apart.
Default, devaluation and junk status here we come.
Absolutely correct. Also, keep us poor, black and dumb with a D average in school and almost all the school buildings needing to be condemned because they are not renovated.
The rich foreigners, bay street and east street boys and their bought out PLP and FNM cronies don't care because they live in their gated communities, don't pay BEC, have their kids at the best schools in the US, run retail and oil monopolicies and control the government.
Hi Robbi, your points are spot on but nobody in the government is actually listening or remotely understands the issues. I'll try in 4 examples in case some government MP is actually humble enough to read these valuable blogs.
1. Exchange control fees. A parent of a college student has to wire $300 to their child in college in the US. The bank and the government charges them $60 which equates to a full days pay for the parent. If the parent had an account in the US it would cost $0.
2.I am constructing a house in the Bahamas. I buy all the materials at Home Depot and pay VAT once on the shipment. If my Contractor buys the materials in Florida he has to pay VAT twice, if he buys the stuff locally he has to pay it 3 times. The cash flows don't work as VAT is paid up front so their is no recover for me....the poor black consumer.
3.If am saving for retirement i have to buy 14 mostly terrible Bahamian stocks. If I am a foreigner I can invest in the US stock market which has thousands of stocks to choose from and is going up every day.
4.If I am a foreign investor I can borrow at 3% in US dollars, if I am a Bahamian investor I have to pay 9%...if the bank will take the risk...by the way i'm black and poor...so I just ain ga get no damn loan from Royal.
I guess I ga just have to stay black and poor under the PLP or FNM.
observer2 says...
Based on how the Minister has phrased the corporate tax communication I would assume that by the end of FNM's current term in office some form of corporate/income tax will have been implemented.
The communication is just the first shock to soften up the general public. Similar to how the PLP implimented VAT and legalized gambling.
Bahamian citizens, permanent residents and foreigners are therefore on notice to get their affairs in order.
Some considerations and questions left wide open by the Minister during his most unhelpful communication.
1. Are we talking a corporate tax or an income tax. There is a big difference as a corporate tax does not impact individuals.
2. Are we talking a corporate tax on Bahamian companies resident for exchange control purposes or does it include non resident companies which are used mostly by foreigners and residence e.g. IBCs.
3. Are we talking a corporate tax on domestic earnings (local businesses) or will it include international businesses (or world wide income).
4. Are we talking a taxation based on underlying beneficial ownership (citizenship tax) or on the "place of doing business" or residency? How do you determine residency for tax purposes. Eg. In the US if you are a non resident and you are in the US for less than 120 days then you are not deemed to be resident for tax purposes. The US taxes on world wide income.
5. Will the corporate tax include passive financial income such as capital gains, interest income and dividends or will it be earned income from a trade. If it is from a trade does it only touch upon a trade performed in the Bahamas?
I can go on and on with many other queries. But to be safe we should assume that the government (as it did with VAT) will cast the widest net and then close it when the foreigners/non resident companies start to migrate to Cayman or the BVI (those that have not already done so) and the Bahamians start to scream.
We should also assume that the Business license fee will remain. So Bahamian business will be taxed on the top line (business license), on the bottom line (income tax) and on every transaction in between (VAT).
The Tribunes article probably has already been circulated to the Head Offices of many international companies that have IBCs subsidiaries in the Bahamas and I would assume they would start making contingent plans immediately.
While Bahamian will "consult" with the government and get into all sorts of arguments the foreigners will start to move now.
On ‘Low level’ corporation tax studied
Posted 4 November 2017, 1:54 p.m. Suggest removal
observer2 says...
Did you notice people working on the roads on holidays and weekends but ya can't see dem workin during da week. Das cause during da week dey do'in dey own work.
Now dat da government dem pay'in dey ga just work satday, sunday and holiday.
Government dem borrow $750 million....come and get it....
On PLP line up to attack Turnquest
Posted 10 October 2017, 12:09 p.m. Suggest removal
observer2 says...
Maybe the reason people are sending in old bills is because the government appears to be paying all of them. I guess the PLP stop paying bills so the people stopped sending bills.
But now that KP is in charge and paying bills then everyone is digging up all kinda old bills and KP ga just keep pay'in dem.
Get the word out KP pay'in old bills...hurry send dem in.
On PLP line up to attack Turnquest
Posted 10 October 2017, 12:07 p.m. Suggest removal
observer2 says...
Where dey tink dey go'in drillin fa oil wit $1 million dollars? WTF? Dis company has been loosing money since it was formed (over $1 million a year), never made a dime in its life.
When da oil spill and mess up da Exuma sea park like BEC mess up Clifton who ga pay?
Poor black ignorant Bahamians, das who. Wake Up Bahamas!
https://www.bpcplc.com/investors/financ…
On Oil explorer's boost for 'faster' farm-in partner conclusion
Posted 3 October 2017, 2:21 p.m. Suggest removal
observer2 says...
Share price has collapsed from over $40 to under $1. Looks like a penny stock to me. No worries, just what the Bahamas needs. Another broke a#s foreigner investing in the Bahamas. Let roll out the red carpet to them.
http://tribune242.com/users/photos/2017…
On Oil explorer's boost for 'faster' farm-in partner conclusion
Posted 3 October 2017, 2:15 p.m. Suggest removal
observer2 says...
no. you are not looking for bahamians to run dat.
how come you never see all these nice jobs in the newspapers being advertized?
how come all of a sudden a complete board of directors is appointed in a non transparent manner?
why are all the contracts done in secret?
On BPL ‘will have to be privatised’
Posted 22 September 2017, 3:22 p.m. Suggest removal
observer2 says...
Brian, you have well articulated that there is massive overregulation but you have not give one single solution.
Maybe because the protected legal profession charging 2.5% on every land transfer, or the complete lock out of foreign lawyers, or the exorbitant cost of $5,000 lawyers charge to incorporate a company when it can be done online in the states for $150. Sounds like a business crushing cartel to me.
Here are some more monopolies you can break up to get business moving again:
what about the money stolen through the monopolistic importation of all fuel into the country?, what about the 20 year Arawak Container Port monopoly over charging Bahamians? What about the exchange control cartel fee to convert funds of 1/2%? What about the BEC monopoly of extremely high prices? What about the shut out of solar and wind energy?
The economic system is dysfunctional. One bad hurricane across Nassau and the house of cards falls apart.
On Top QC: Regulatory regime ‘weighted against business’
Posted 20 September 2017, 5:30 a.m. Suggest removal
observer2 says...
Ok, but what about the money stolen through the monopolistic importation of all fuel into the country?, what about the 20 year Arawak Container Port monopoly over charging Bahamians? What about the exchange control cartel fee to convert funds of 1/2%? What about the BEC monopoly of extremely high prices? What about the shut out of solar and wind energy?
The economic system is dysfunctional. One bad hurricane across Nassau and the house of cards falls apart.
Default, devaluation and junk status here we come.
On ‘One law for all’ call on BPL no disconnect list
Posted 20 September 2017, 5:19 a.m. Suggest removal
observer2 says...
Absolutely correct. Also, keep us poor, black and dumb with a D average in school and almost all the school buildings needing to be condemned because they are not renovated.
The rich foreigners, bay street and east street boys and their bought out PLP and FNM cronies don't care because they live in their gated communities, don't pay BEC, have their kids at the best schools in the US, run retail and oil monopolicies and control the government.
On Bahamians 'put out of business' if no lending, exchange control ease
Posted 18 September 2017, 8:59 p.m. Suggest removal
observer2 says...
Hi Robbi, your points are spot on but nobody in the government is actually listening or remotely understands the issues. I'll try in 4 examples in case some government MP is actually humble enough to read these valuable blogs.
1. Exchange control fees. A parent of a college student has to wire $300 to their child in college in the US. The bank and the government charges them $60 which equates to a full days pay for the parent. If the parent had an account in the US it would cost $0.
2.I am constructing a house in the Bahamas. I buy all the materials at Home Depot and pay VAT once on the shipment. If my Contractor buys the materials in Florida he has to pay VAT twice, if he buys the stuff locally he has to pay it 3 times. The cash flows don't work as VAT is paid up front so their is no recover for me....the poor black consumer.
3.If am saving for retirement i have to buy 14 mostly terrible Bahamian stocks. If I am a foreigner I can invest in the US stock market which has thousands of stocks to choose from and is going up every day.
4.If I am a foreign investor I can borrow at 3% in US dollars, if I am a Bahamian investor I have to pay 9%...if the bank will take the risk...by the way i'm black and poor...so I just ain ga get no damn loan from Royal.
I guess I ga just have to stay black and poor under the PLP or FNM.
On Bahamians 'put out of business' if no lending, exchange control ease
Posted 18 September 2017, 6:48 p.m. Suggest removal