NASSAU, BAHAMAS– The Opposition is challenging the Government’s announcement that it has reduced VAT from 10 percent to 5 percent on medicines, medical supplies, feminine hygiene products, and baby and adult diapers, describing the move as “misleading” relief for families.
According to J. Kwasi Thompson, M.P. for East Grand Bahama, “Under the FNM, VAT on these same items was zero. This administration raised the rate, called it reform, and now pretends to be easing the burden by cutting their own tax in half.”
Thompson criticized claims by the Prime Minister that the reduction was made possible because “the economy is stronger, and government finances are on sounder footing.” He said, “Every Bahamian knows the truth. Light bills are the size of rent or mortgage payments. Families are squeezed by higher fees and new taxes. Food, fuel, and everyday costs remain painfully high. To speak of sound footing while people cannot make ends meet shows just how disconnected this administration is from the daily struggles of Bahamian households.”
The Opposition points to the Ministry of Finance’s 2025 Fiscal Strategy Report, which shows public sector debt increased by $402.5 million in nine months, pushing the national debt above $13.1 billion as of March 2025. Thompson argued that while revenue may be up, “there is no transparency about how that money is being used. Schools remain under-resourced. Clinics and essential services are stretched thin. At the same time, there is no published debt management strategy and no clear plan for repayment. Bahamians are left to wonder where the new borrowing is going.”
Thompson also highlighted a discrepancy in the Government’s budget projections. “Just months ago, the Prime Minister claimed the budget projected an April surplus of $135 million. However, the final numbers revealed a $2.1 million deficit instead. That represents a $137 million swing that cannot be dismissed as a minor error. If a government cannot report its own finances accurately, how are we to believe that our ‘government finances are on sounder footing’?”
The Fiscal Responsibility Council has reportedly raised concerns about the Government breaching its fiscal rules. Thompson stressed that these warnings should be taken seriously.
He concluded with a call for action: “The way forward is clear. Restore the zero VAT rate on essential medicines and supplies. Provide a credible debt management plan and a full accounting of new borrowing. Invest properly in schools, clinics, and frontline agencies. And above all, level with the Bahamian people by publishing accurate, transparent financial reports.”
