Gaming houses want govt data on tax hike made publicMajor: We would appreciate a better understanding of the empirical data or the analysis that was conducted
Insisting that the analysis of the Bahamas Gaming Operators Association (BGOA) shows something different, Chief Executive Officer of the BGOA Gershan Major said the government should make public the empirical data it has to support the $3.4 billion it says is being gambled by Bahamians.
According to Major, gaming houses earn $72 million in net revenue annually.
Yesterday the Ministry of Finance released an infographic explaining how the new progressive tax rate impacting gaming house operators works.
“Unfortunately it’s very difficult to comment on a number that we have no understanding of how it was derived. What we would appreciate is getting a better understanding of the empirical data or the analysis that was conducted to determine that number,” Major said in an interview with Guardian Business yesterday.
“In fact, if that number is supported by any data we are open to determining where that comes from, because that is not the data we have. And quite frankly, when you think about it, the government knows very well the financial audited statements of each of the licensees in the sector, so I’m a bit concerned that such a number would be put out in the public space without any form of data to support it.”
Last week during his presentation of the 2018/2019 budget communication, Deputy Prime Minister and Minister of Finance Peter Turnquest announced that, starting July 1, gaming houses that make revenues up to $20 million will be taxed at a rate of 20 percent; those that make between $20 and $40 million at a rate of 25 percent; those that make between $40 million and $60 million at a rate of 30 percent; those making between $60 million and $80 million at a rate of 35 percent; those making between $80 million and $100 million at a rate of 40 percent; and the gaming houses bringing in more than $100 million at 50 percent.
Major said the BGOA has no issue with tax increases, as long as they are fair and supported by empirical data.
“Let me be very clear, unequivocally so there is no mistake in the minds of Bahamians, the domestic gaming industry has no issue with seeking to pay what is considered a fair increase in taxation as a member of the private sector. We do have a problem, a significant problem, with how that process is taking place,” Major said yesterday as a guest on Guardian Radio talk show “The Revolution”.
“There was no consultation, we have no idea as to the analysis being done on the government side…what we’re saying is, let’s come to the table, let’s sit down, let’s find the international gaming tax experts who are out there and do a real, fair comparison on what is a reasonable position on a proposed tax increase that is palatable, that will not decimate the industry and will not risk 2,000 Bahamian jobs.”
Major said, as regulated members of a formal economy, if there is a determination that the government of the day needs to extract more in taxes from the private sector, the BGOA is prepared to comply.
However, he criticized government’s approach of hiking tax rates on the industry based on “inferences, hunches and conjecture”.
“If we’re going to go down that route with our elected officials then it raises the question of broader competency and judgment,” he said.
“Facts matter, due process matters, meaningful consultation matters, jobs matter and at the end of the day, that is our core position, that is at the heart of why we are doing the rounds to educate Bahamians and the government on the gaming industry.”
On Thursday, the BGOA released the results of a study it conducted on the impact the government’s proposed tax rates would have on the industry. That study, conducted by an independent expert, Gavin Hamilton, found that as a result of the new tax rates, 2,000 jobs would be lost from the sector and 192 gambling venues would close down.