Seeking to make a case for why voters should support the Progressive Liberal Party at the polls tomorrow, PLP Leader Philip Brave Davis claimed at a virtual rally last night that the Free National Movement (FNM) administration would raise taxes if re-elected.
“We have been told by credible sources that the government called a snap election because their back is against the wall with the country’s creditors; they’re ready to raise your taxes, but they ain’ plannin’ to tell you that until after you vote,” Davis charged.
“And they’re going to raise your taxes because they are too afraid of their wealthy donors to raise theirs, and because they have no new ideas and no clue how to create economic growth.”
The PLP intends to lower taxes for the poor, he pledged.
“It’s true we’re going to need new revenue to stabilize our finances, but we’re going to ask the wealthiest to pay more, and to pay what they already owe, instead of reaching into your pocket,” Davis said.
“The current government, on the other hand, is getting ready for a repeat performance. They raised VAT (value-added tax) 60 percent for you, while handing out special tax deals for the wealthy and well-connected, and they gave VAT breaks to multinational corporations in Grand Bahama. And who could forget that they reduced business license fees not for small businesses, but for those with more than $50 million in annual sales.”
The PLP has pledged to lower VAT from 12 percent to 10 percent for 12 months. In 2015, the Christie administration introduced VAT at a rate of 7.5 percent.
Then Opposition Leader Dr. Hubert Minnis called the taxation the lazy way out, and the FNM suggested throughout the 2017 election campaign that the VAT money had been stolen by those in government and their cronies.
Davis told Bahamians last night the tax cut his administration would implement would “help you a little; it will lighten the load during these tough times, and make every dollar go a little farther”.
PLP Deputy Leader Chester Cooper said previously that the plan to decrease VAT could increase government revenue by $200 million, contending that the economic principles suggest that lowering costs will increase demand.
However, Cooper said the 10 percent VAT position would be evaluated after one year to see if it indeed had the revenue increasing effect he cited.
“The 12-month marker will give us enough time and enough empirical evidence to demonstrate whether that rate must continue to be 10,” he said in March.
The Minnis administration said at the time that the PLP’s plan would cause a “dramatic decrease in government revenue, likely in excess of $100 million during the proposed 12-month period, at a time when the country’s fiscal resources are under tremendous strain and the needs for government to support social and economic programs are even more pronounced.”
At the end of the 2020/2021 fiscal year, the fiscal deficit stood at $1.3 billion, up from $811.7 million in the previous year.
The national debt climbed to $10.3 billion.
Gross borrowing was at $3 billion for the fiscal year.
‘Amateur in charge’
Last night, Davis claimed the Minnis administration called an election without a plan to rejuvenate the economy and stabilize finances.
“Now they are shouting last-minute promises at you from the rally stage. A hastily-thrown together list of promises isn’t the same thing as a strategic plan,” he said.
“And they are likely to keep these new promises about as well as they kept the ones they made in 2017 – which is to say, not at all.
“It’s extraordinary, how many Bahamian and international investors have told me the same thing: under this government, the Office of the Prime Minister is where good ideas and big plans go to die.
“The prime minister has no business being the minister of finance; things are too serious and growing our economy is too urgent to have an amateur in charge.”
Davis said The Bahamas has been stuck with no real progress under the Minnis administration.
“This government inherited the twin gifts of Baha Mar and a booming US economy, but they still struggled to create economic growth, even before Dorian and COVID,” he said.
“They were left a framework for a Sovereign Wealth Fund, for our natural resources, but they dropped the ball and made zero progress. We’re going to leverage our natural resources, ensuring that royalties go into the fund and are used to benefit generations of Bahamians.
“We’re going to encourage the development of value-added industries, so that natural raw materials can be turned into finished products here, in The Bahamas, instead of somewhere else.”
While Davis has branded the 81-page FNM Manifesto ‘21 as a hastily put together plan, Prime Minister Minnis has called the PLP’s 29-page “Our Blueprint for Change” a pamphlet with recycled ideas.
In its manifesto, the FNM pledges to “resource a National Sovereign Wealth Fund”.
It says it will “mobilize public assets and private capital to generate hundreds of millions of dollars in infrastructure investments across the country every year.”
Today is the final push for the political parties and the various candidates as the finish line approaches.
Over the last month, the prime minister has been warning voters that the PLP would return “scandal and corruption to government”.
The PLP, meanwhile, has continued to speak of what it views as the incompetent management of the people’s affairs.
In total, 194,524 Bahamians are registered to vote.