It would be “foolish” to leave any kind of corporate or income tax off the table as The Bahamas moves forward with creating a new tax environment, Clearing Banks Association (CBA) Chairman Gowon Bowe said yesterday in response to Deputy Prime Minister and Minister of Finance Peter Turnquest’s recent rejection of any such consideration by his ministry.
Last week in the House of Assembly, Turnquest said there are currently misleading impressions that the Ministry of Finance is planning to implement some kind of corporate tax.
“We have never indicated to anybody that we are introducing anything about corporate tax. What we have said – and we continue to look at developments – is we continue to read what is on the horizon and we prepare, because any decision that we make as a country going forward must be based upon empirical data. We do not have the opportunity or the time now in this day and age to be making decisions on the fly,” Turnquest said.
“So, let me debunk again for those who are out there spreading that the Ministry of Finance is intending to raise value-added tax or to implement any corporate income tax or any personal income tax: that is absolutely untrue, there is no such initiative.”
Bowe said if the government wants to remain a global contender, it has to diversify its tax structure.
“The minister unfortunately not only is caught as a policy maker but also a politician and he knows that the general sentiment of society is that they don’t like the word taxes,” Bowe said in an interview with Guardian Business yesterday. “If we are very candid in terms of assessing our current tax system, is it really fit for purpose going into the 21st century and beyond?
“When we look at our current tax structure, people can criticize it in terms of saying we’re not collecting all that we should and there’s greater efficiency that can be had, but is the actual tax burden being distributed amongst those based on their ability to pay, or is a consumption-based tax effectively regressive? We know the answer, I’m being facetious, it is that the poor among us pay the most in terms of taxes.
“So, when we start looking at a tax structure I think it is foolish for us to say that anything is off the table. I think that is selfish for persons to say that we should stick with what we have because it has done us well.”
The Ministry of Finance is in the process of restructuring, according to Turnquest, who said an economics unit is being established that is going to be particularly aggressive in its research of the Bahamian economy, so as to provide options to the government when they may be required.
“The Ministry of Finance and its agencies are doing the prudent and required thing to ensure that we do the research, so that we know the alternatives that are available, so that in the event that we are called upon to make a policy recommendation we are armed with information,” Turnquest said.
Paige started working as a business reporter in August 2016.
Education: Palm Beach Atlantic University in 2006 with a BA in Radio and Television News