Saturday, Nov 17, 2018
HomeReal Estate RealitiesThe chickens have come home to roost

The chickens have come home to roost

“The chickens have come home to roost!”

This proverbial saying is perhaps the best way of describing our financial predicament which we currently find ourselves in.

Government has announced that effective July 1, 2018, value-added tax (VAT) would be increased from 7.5 percent to 12 percent.

It has certainly gotten the general public up in arms with this increase and they are screaming bloody murder.

This new increase will increase the cost of doing business and you can expect an increase in the cost of real estate as owners are certain to pass on this increase to the buyers.

I am sure the government has thought hard and fast about making this increase as they know what expenditures have to be made and should have a fair idea of what revenue they can expect to come in. It is obvious there is a shortfall, hence taxes are being increased to limit the damage to our economy.

We all have to tighten our belts but more importantly, the government must lead the way and become more austere in the handling of our finances.

Truth be told, we did not get ourselves in this position overnight. Successive governments have been spending monies like a drunken sailor on the town and it’s time they stop, take a hard look, spend the people’s money like it’s theirs and reduce all of this free spending so obvious to the public.

New government cars can be seen all hours of the night cruising, or in school yards picking up children and running personal errands.

It is time the government put in a car policy and have those cars parked once the office has been closed for the day. This might seem like a trivial item but if you multiply this by the several hundred cars they have, including the gas and maintenance of these vehicles, you can certainly see where it adds up.

Another aspect of government which should be monitored is travel expenses for government officials. Oftentimes, members of government flying first class with a huge entourage adds to the cost. The prime minister should absolutely travel first class but the rest of the party should fly in economy and, yes, some of these jaunts these politicians and civil servants go on, are they really necessary?

We like to show off by hosting conferences and sporting events, but things are a bit tight, so perhaps it is high time to tell our friends no; we cannot host functions as these events are not cheap and must be put in abeyance until we can afford to do so.

Another sore point is the number of foreign consultants we bring in with hefty retainers; can’t we find Bahamians to do these jobs? Yet we are hellbent on bringing foreign consultants in droves, paying them good money in droves.

Government buildings are a disgrace and need better maintenance, and ministries end up renting expensive buildings, costing the taxpayers thousand of dollars in rent which could have easily been appropriated to maintain those buildings and save that rent money, instead of making these landlords millionaires.

Barbados and its people, we have always admired, and it was once a jewel of an island; but if you read the news lately, their financial situation is very serious, where they have stopped paying the bills and have called on the IMF to bail them out. This is not something we expected to come out of Barbados, so we better be very careful on the road we are traveling.

Devaluation has been on the mouth of some of our most senior government ministers and it’s not a matter to be taken lightly, because if you are screaming now about VAT at 12 percent, be prepared for what else may have to follow.

Pretty scary!

 

  • William Wong is a two-term president of the Bahamas Chamber of Commerce and Employers’ Confederation and two-term president of the Bahamas Real Estate Association. William Wong is a partner at Darville-Wong Realty. E-mail: williamuwong@gmail.com.

 

 

 

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