Comments on the Bahamas budgetary snapshot, July-December 2019
Enclosed in the Tuesday, Feb. 4, 2020 Bahamian newspaper I purchased, was an insert from the Ministry of Finance entitled, “First Six Months Fiscal Snapshot on Budgetary Performance”.
For this letter, I will only comment on the revenue side of this informational.
Aggregate revenue topped $1 billion ($1,103,500,000) for The Bahamas in these six months of 2019.
Tax receipts accounted for over 90 percent of this revenue.
Of this amount, nearly 90 percent of all revenue came from directly taxing the people of The Bahamas, in the form of VAT, duty and other taxes. From my calculations, the equivalent taxes of roughly $2,500 per person in The Bahamas.
Perhaps this seems alright to you. But, I would like to offer my perspective, in which a few glaring numbers and statements stood out to me.
Firstly, total gaming taxes were just over $19 million, by which the Ministry of Finance thought it wise to state in this snapshot that, “Collections from gaming taxes nearly doubled to $19.4 million, reflecting the implementation of the revised tax regime agreed to by the government and gaming operators.”
I have a question. Why does the Ministry of Finance think it important to point out that the gaming operators were involved in determining how much they would be taxed?
Were you and I consulted on how much we, as working class Bahamians, would like to be taxed? Or, if we could afford the 60 percent increase in VAT?
Gaming taxes, with all the web shops and casinos in this small nation, came to little more than one percent of the taxes raised here.
Secondly, total property taxes accounted for $34 million or roughly three percent of the total taxes collected by this government.
Yes, three percent.
Anyone flying into Nassau and looking down from the usual landing flight path, cannot help but be struck by the large number of mansions, yachts, pools and gated communities on the ground below. So often I find the other passengers saying, “There sure is plenty money in this country.”
Yes, there is. Billions and billions of dollars worth of real estate and accoutrements.
I have a question. Given that there are no income taxes, no corporate taxes, no capital gains taxes, and no inheritance taxes on those who can afford to claim residency here in The Bahamas, is it fair to place so much of the tax burden on those who help make this country such an attractive place for the rich? I mean the Bahamian people, of course.
Think about this for a minute.
The Bahamian government sells Bahamian residency and Bahamian citizenship to the highest foreign bidders.
It is typical that those who choose to buy into this scheme save millions, maybe tens of millions, maybe hundreds of millions of dollars each year in taxes payable to their home countries, where they ordinarily live and do business. But, because The Bahamas excels in financial services, we invite them here to “invest”, while allowing them to enjoy such amenities such as a stable democracy, superb beaches, clean water, and a compliant work force, mostly for free.
Does this sound fair to you, the Bahamian taxpayer, who carries the vast majority of tax burden to run this government and provide the services needed to maintain an element of civility and normalcy in this country?
The many touted benefits of having an increase in high net worth individuals, as they are called by our financial gurus here, do not exist in a vacuum.
These benefits exist side by side with many detriments, rarely acknowledged, let alone talked about by those in the know. These include higher property prices for all, a skewed job market, a greater carbon footprint with the private jets, yachts, and property requirements.
In a country where every job, no matter how menial, is regarded as a godsend, this may seem to be a moot point. Yet, if the skyrocketing cost of living in this country is of any concern, we must look more closely at our tax policies — tax policies that are THE driver for the skyrocketing cost of living.
I propose raising the property taxes on high end properties to account for an equal proportion of tax revenue as collected from VAT — 50 percent of the revenue from property taxes, 50 percent from VAT.
I can hear the realtors now.
I am saying that property taxes should be raised for these high end properties many times over.
Why is it okay to raise VAT 60 percent overnight, but not property taxes for the richest?
If it really is better In The Bahamas, we should ask, better for whom?
What about instituting a fair and progressive income tax?
But no politician has the true courage and Christian honesty to propose this. And, it is needed and warranted, were we to educate ourselves accordingly and act in a Christian manner.
I have no such illusions.
If some of the richest property owners object to this increase, let them go.
The third comment I would like to make is that we must break away from the divide and conquer politics we have descended into.
It must be remembered that Prime Minister Minnis, while in opposition, vehemently opposed the implementation of VAT.
Why? Because it hurt the poor. And he was entirely correct.
Once in office, he had a revelation, I suppose. And, not only did he keep VAT, he raised it by 60 percent.
We childishly continue to rally and cheer on parties, not issues, not people.
So long as we remain willingly ignorant about how our own government treats us, we will continue to see our lives become more difficult.
Much is said about our poor educational system. But, less is said about those who are able to dictate to us, as our minister of finance and prime minister do, and what their educational bias reflects.
Who bears the true burden of taxation and a skyrocketing cost of living in The Bahamas?
And, I will say the same for the business gurus who advise our leaders.
They continue to support and champion a system that has failed the average Bahamian – utterly failed.
And yet, because their jobs and well-endowed salaries depend upon the continuation of these failed and unChristian policies, they too will continue to go along with the flow.
They are doing just fine, thank you very much.
The true cost of our failed educational system here in The Bahamas is not just one of reduced job opportunities and truncated literacy and numeracy skills.
The real damage done by our failed educational system is that we now lack the intellectual skills to challenge the oppressive taxation policies of this country and the burden these place on the vast majority of Bahamians.
Yes, a handful are getting extremely rich, while the unwashed masses are seeing their ability to make ends meet diminished each and every day.
The policies of both the FNM and the PLP are oppressive to the majority of Bahamians.
The owners of this nation, the true owners, are in a different class than the majority of Bahamians. They are unable to feel the pain experienced by most.
This goes for most doctors, lawyers, real estate agents, accountants, even the pastors — those who would have the most clout in speaking up on behalf of the working class and poor.
The agenda that would benefit the majority of Bahamians will not be tabled, because it is not in the interest of those currently profiting from the rank system we presently have in place.
In summation, the Fiscal Snapshot presented by the Ministry of Finance is one of neo-slavery.
The small country of The Bahamas is impoverishing, and forcing out its own citizens while pandering to the rich and those who sing for their supper at the tables of the rich. Both the PLP and the FNM are exactly the same in this regard, along with our professional class.
This is where we are in 2020.
It is the people’s time, remember. Now ask, “which people?”