Tax avoidance causing $200m annual revenue loss

Tax avoidance causing $200m annual revenue loss

PM announces data-driven response to stop revenue slipping through the cracks

NASSAU, BAHAMAS — Prime Minister Philip Davis revealed on Wednesday that the government is employing a data-driven approach to aggressively tackle numerous tax avoidance schemes, which are causing the government an annual loss of approximately $200 million in revenue.

During his delivery of the mid-year budget statement in Parliament, Prime Minister Philip Davis stated: “Regarding VAT, customs, and business license enforcement, the Ministry of Finance has embraced a data-driven strategy, complemented by the establishment of an analytical unit within the Ministry of Finance. The outcomes thus far have been noteworthy, as the unit’s efforts have uncovered multiple instances of significant tax avoidance. In just the last three months, the government has confiscated over $400,000 in cash and nearly $1 million in alcohol, as part of a large-scale alcohol smuggling operation. Our initiatives against alcohol and tobacco smuggling are escalating – indeed, we estimate that the country loses close to $100 million annually due to these illicit activities. Consequently, we are allocating substantial resources to address this revenue loss.”

He further stated: “Our endeavors have identified numerous tax avoidance schemes, which we are actively combating through audits and investigations. The potential revenue loss amounts to approximately another $100 million.”

Prime Minister Davis highlighted that the Ministry of Finance is collaborating with consultants to develop analytical tools for detecting tax fraud. He noted that these tools would automate tasks currently performed manually. The collective outcome of these efforts is projected to be an overall increase in revenue from VAT, Customs, and Business Licenses.