Opposition warns businesses of tax pressure as PM pledges improved compliance and enforcement

Opposition warns businesses of tax pressure as PM pledges improved compliance and enforcement

NASSAU, BAHAMAS — The Official Opposition issued a warning yesterday, cautioning businesses to anticipate continued government pressure in tax collection. 

Free National Movement Leader Michael Pintard expressed those concerns following the budget communication, during which Prime Minister Philip Davis pledged no new taxes but emphasized improved tax compliance and enforcement.

“The level of pressure they intend to apply on businesses should be expected to continue,” Pintard said. “This government has shown a lack of respect for the business sector. They have failed to engage in adequate and timely consultations, and their decisions seem to lack appropriate justification based on informed studies.

He continued: “This government appears desperate. If, as they claim, we are performing exceptionally well, what justifies some of the decisions they are making? They must control their spending. The problem lies in their high expenditure.

“We need to thoroughly examine every document to ensure the accuracy of their claims,” Pintard added. “Their actions simply do not align with their words.”

During his 2023/2024 budget communication in Parliament, Prime Minister Davis boasted of his administration’s commitment to diligent and prudent financial management, along with a set of medium-term budgetary targets.

“A crucial objective will be to generate more revenue for the public purse without increasing taxes. This means no rise in the VAT rate, customs duties, excise duty, tax rates, or real property tax rates. Instead, we will enhance revenue collection by focusing on tax compliance and enforcement, guided by the principle of fairness,” said Davis.

He further stated that the government plans to establish a Large Taxpayer Unit to enhance compliance and revenue collection from the approximately 100 businesses responsible for $1.7 billion in taxes.

“We will introduce a national revenue targeting center that utilizes technology to identify irregularities in revenue reporting by taxpayers, leading to more efficient audits. Additionally, we will bolster revenue collection in the Family Islands by increasing staffing levels in revenue collection agencies,” said Davis.

To address chronic revenue underperformance in the marine sector, we will introduce and implement an updated fee schedule for the registration of pleasure crafts.

“Our aim is to promote the success of State-Owned Enterprises (SOEs) by enhancing transparency, efficiency, and profitability in their operations. Consequently, we have reduced the budget allocation for SOEs from the previous budget,” explained Davis.