Concluding the mid-year budget debate
The mid-year budget debate in the House of Assembly has concluded.
Yet, outside of a few presentations, it was not a particularly overall informative debate.
Prime Minister and Minister of Finance Philip Davis had the most notable contributions that laid out the pace of revenue collection, expenditure and debt, all of which appear to be in a relatively good position.
His confusion surrounding the deficit marred what should have otherwise been a beacon of welcome news for the country.
We note that nearly a week after he falsely claimed in Parliament that The Nassau Guardian made up a report that the deficit was up in the first six months of the fiscal year, the prime minister apologized to the paper and admitted that he got it wrong.
“Permit me a moment to clear something up: Last week, I spoke about a headline in The Nassau Guardian about the fiscal deficit,” said Davis as he wrapped up debate on the Mid-Year Budget.
“I said that the headline was wrong; but in fact, that headline accurately reflected what was said in my communication but was inconsistent with the technical information we provided, that is, the Mid-Year Budget Performance Report, which was tabled.
“I want to take responsibility and to apologize, to thank The Guardian for their follow-up reporting on the progress the government has indeed made on fiscal matters. When we get something wrong, we will say so.”
The prime minister’s apology, which we accept and appreciate, came as he laid out his administration’s priorities for the next few months.
“On our agenda for the remainder of this fiscal year,” he said, “we will initiate an unprecedented investment in food security, roll out a significant increase in social support, continue our investment in small and medium-sized businesses and lend support for new businesses through the SBDC (Small Business Development Center).
“In essence, we will continue with our people-focused agenda, which also includes things like addressing learning loss, redeveloping and expanding 14 airports throughout our Family Islands, protecting our borders, recruiting hundreds of new defense force, police force, and immigration officers, and renovating Family Island clinics.”
He added, “Everyone is important to us.”
The prime minister spoke a great deal about the growth in our economy and this administration’s supposed focus on the most vulnerable, but did not ameliorate fears in the business community about the policy decisions that have decreased the ease of doing business in this country.
“We have to ensure that everyone is paying their fair share in this country,” the prime minister also said.
“Paying taxes is not something people can just choose not to do. The vast majority of people are paying their taxes, and it’s not fair for those who follow the law to shoulder the financial burden of those who do not.
“We are seeing the best real property tax compliance rates in many years. The worst culprits when it came to non-payment, and the records reflect this, were many owners of the most valuable properties in The Bahamas.
“We have ensured that they are paying their fair share.”
His continuing mantra of making people pay their fair share fell flat among those working and middle-class families who are seeing the cost of living rise beyond their reach.
The increase in the electricity fuel charge, the increase in property taxes for many because of increased government valuations, the increase in the minimum wage, the increase in home insurance, the expected rise in private healthcare costs and inflation, among other things, are adversely affecting those who do not need government’s help — those people would rather prefer to be left alone by government as it seeks to squeeze every dollar it can out of those it believes can afford it.
The government should of course seek to maximize tax collection, but to pretend only the rich are being impacted by those efforts is trafficking in fantasy.
That is not to say this administration has not made any good tax policy decisions.
It’s raised the exemption ceiling for first-time homeowners and lowered taxes for purchasing homes under $1 million — these actions have lowered the barriers to entry of homeownership.
Lowering value-added tax has also helped both the economy and government revenue collection, in our opinion.
But just as Bahamians want to live in an economy that is growing, they want to live in an economy they can afford.