NASSAU, BAHAMAS — The Opposition’s Shadow Finance Minister is calling on the Davis administration to explain the decrease in Value-Added Tax collections for two consecutive months (June and July 2022) compared to the same period last year.
East Grand Bahama MP Kwasi Thomson said he was “extremely concerned” in a statement, as the figures come despite the country’s economic rebound.
“According to the government’s 12-month Fiscal Snapshot 2021/22 report, VAT revenue for the month of June 2022 was $13.7 million (or 14 percent) less than what was collected in June 2021,” Thompson said.
“In the government’s monthly budget report released today, for July 2022, VAT collections were some $37 million (or 26 percent) less than it was in July 2021. This is in spite of the fact that the economy in 2022 has rebounded substantially compared to last year with tourism and employment numbers almost reaching pre-pandemic and pre-Dorian levels.
Thompson asked if this is the main reason why there was a delay in the publishing of the July and August budget reports.
“Is this why we still haven’t seen the August 2022 budget report which should have been published last week? This fall-off in VAT revenue is even more concerning given this government’s increased spending when we in the FNM have consistently called on them to exercise prudence and restraint,” continued Thompson.
A recently released statement from the Ministry of Finance revealed that the government had posted a $40.2 million surplus in July 2022, driven by tax revenues.
In light of this Thompson added: “The government must explain why for two consecutive months, the VAT receipts are significantly down even though the economy is significantly stronger and the government has in place an announced revenue enhancement team?
“It is important that the government provides a fulsome explanation for the benefit of Bahamian taxpayers and the credit rating agencies who are closely monitoring our credit profile.”
