Gibson: Put off VAT increase
While he supported the government’s plan to increase value-added tax (VAT) from 7.5 percent to 12 percent, Long Island MP Adrian Gibson yesterday suggested the government postpone the implementation date.
During the 2018/2019 budget communication on May 30, Minister of Finance Peter Turnquest announced that the increase will take effect on July 1.
“While I support the increase in VAT and the simultaneous reduction and eventual elimination of customs duties on various imports, I’m concerned that there wasn’t a greater degree of public consultation and or consultation with big business and or the business community,” said Gibson during the budget debate.
“Given the concerns being expressed, Mr. Speaker, the increase perhaps should be postponed until the third or even the fourth quarter, as opposed to immediate implementation on the first of July.
“In my constituency, I’ve faced many questions. This would allow business houses to organize their accounts and their affairs.
“I spoke to Long Island business persons and even chatted with Mr. Rupert Roberts (of Super Value) this morning and I can tell you that many of them feel that a brief postponement will be more palatable.”
Turnquest said the government must find a way to pay off its “massive backlog of arrears” and set the stage for pending reductions in customs duties when The Bahamas accedes to the World Trade Organization next year.
The increase in VAT is expected to bring in an additional $400 million in new revenue.
Public Domain conducted a telephone survey between June 2 and June 6, 2018 on the government’s budget.
Eighty-six percent of respondents believe the government should have engaged in public consultation prior to proposing this new budget. Seventy-six percent of those surveyed oppose the budget. Twenty-four percent support it. Seventy-three percent oppose an increase in VAT.
Only seven percent agreed with the government’s characterization of its new budget as “The People’s Budget”.
Sixty-two percent believe the budget is designed to benefit special interests within the Free National Movement.
Sixteen percent said it is a budget like any other budget, and 15 percent said they did not know.
Gibson also noted yesterday that the government should look at increasing bank and trust company fees to bring in more revenue.