The head of the Bahamas Chamber of Commerce and Employers’ Confederation (BCCEC) said the chamber still has high hopes that government will consider moving the introduction of value-added tax (VAT) to a later date.
Government is presently debating the 2018/2019 fiscal budget in the Lower Chamber and there have been no signs that it will postpone the July 1 introduction.
BCCEC Chief Executive Officer (CEO) Edison Sumner said, if the government does not pump the brakes on VAT, it could throw the country into, “chaos.”
“When we introduced Vat for the first time in 2015, it took us over one year to do public education campaigns. Even after it was implemented it took us another six months to ensure that everyone was fully compliant with the introduction of VAT,” Sumner said.
“We are asking, in this instance, for the same courtesy.”
There are 22 days remaining before the new 12 per cent VAT is introduced.
Sumner lamented that the chamber’s forewarnings aren’t being levied without good reason.
“These companies still have to conduct the usual course of business every day. They cannot neglect their daily operations now. Now, they have to pull resources and perhaps hire more people to get things,” he shared.
“They have to worry about getting their VAT filings in by the end of June. Then you’ve also got to rush to be sure that your systems are in place and ready to begin pricing your products on the 1st of July.
“The timeline is just too tight to happen.”
The BCCEC also noted that government should be aware that it isn’t doing the small business community a favor by introducing exemptions on electricity bills below $200.
“I can’t see that having any impact on businesses. I don’t know of any business whose bills come under $200. Multiply that by 10 and then we can have a real conversation about what a real electricity bill looks like for small businesses in the country,” noted Sumner.
He called for less empty promises and more purpose-driven dialogue between government and the private sector.
“Giving exemption for $200 is a great thing, but we need to talk about the cost of energy in the country. We need to talk about the sustainability and efficiency of it and that can only be done if you have a serious discussion about alternative forms of energy,” he shared.
“We don’t think that we are going to be able to tax ourselves out a situation.
“We’ve got to consider our tax infrastructure holistically to determine what will be the best course of action moving forward.”
The BCCEC head said the chamber was blindsided by government’s impending tax hike but, members are happy to know that they will now have a seat at the table with the Fiscal Responsibility Council, which will be tasked with ensuring the financial stability of the country.
“We’ve had input in previous budgets so by the time that it was tabled, we would have no surprises to deal with,” he said.
“This time it was a little different. It was a surprise not to be included in discussions prior to the announcement.
“I don’t think that they will pull that kind of surprise on us again, so, we are looking forward to continuing discussions with all level of government.”