Department of Inland Revenue defends property reassessment exercise, dismisses claim
NASSAU, BAHAMAS — The Bahamas Real Estate Association (BREA) yesterday challenged the legality of the Department of Inland Revenue’s re-assessment exercise, with the latter noting that 10,000 previously unregistered properties have now been accurately assessed and registered.
BREA is calling on the government to immediately withdraw its 2022 Assessment of Real Property Tax, citing its appraisers were not properly licensed under the act.
In a statement yesterday, BREA commended the Department of Inland Revenue for purchasing and implementing Tyler Technology’s tax assessment software but took issue with comments by the company’s vice president Jake Wilson, who confirmed the company was also selected to provide appraisal services.
BREA pointed to the Real Estate (Brokers and Salesmen) Act, 1995, which prohibits any person from the practice of real estate business, including undertaking appraisals, without a valid license issued under the act.
“According to the Act, only a Bahamian citizen or the holder of a certificate of permanent residence with the right to work endorsed thereon can become licensed to practice real estate,” the BREA statement read.
“At no time did Tyler submit to BREA application(s) to license its appraisers under their contract with Government. BREA has not granted any appraiser licenses to Tyler or its personnel. Based on the evidence in the Tyler press release, Tyler has admitted that it was contracted by Government to provide appraisal services to Government on two occasions.”
BREA furthered that the appraisal services provided by Tyler were illegal without a valid license, and by extension, any reassessed property value undertaken by an unlicensed representative of Tyler should therefore be deemed illegal and void in law.
It added: “Under the circumstances and on behalf of the residents of The Bahamas, BREA kindly asks the Government to immediately withdraw altogether its 2022 Assessment of Real Property Tax.”
However, in a statement responding to BREA’s claims, the Department of Inland Revenue (DIR) said the new property tax new bills reflect property valuations based on a re-assessment exercise led by the DIR, supported by Tyler Technologies.
“The DIR would like to assure the Bahamian public that property re-assessments were conducted by experts and based on thousands of field inspections and data analysis while leveraging the latest technology and global best practices,” the statement read.
“The objective of the valuation exercise was to ensure that all properties reflect the current value for tax purposes. The result of this exercise was a broadening of the tax base and a potential increase in revenues, with 10,000 previously unregistered properties now accurately assessed and registered. Through this broadening of the base, the government believes that it is moving towards a fairer and more equitable tax system in an area that has been marked by substantial inequality,” the DIR said.
It added: “The DIR has been made aware of concerns regarding the legality of the re-assessment process, expressly that The Real Estate (Brokers and Salesmen) Act, 1995, (“Act”) would prohibit non-Bahamian citizens or those without a work permit from engaging in the practice of real estate, including undertaking appraisals.
The DIR underscored the Real Property Tax Act, 2010 remits authority for property valuations for taxation to the Chief Valuation Officer (CVO), adding that no such prohibition regarding citizenship or work permits can be found in the act.
“The Chief Valuation Officer (CVO) has the power to obtain information from any person that is relevant to the CVO’s accurate assessment of property under the Act. The Power of the CVO to assess properties for tax purposes is not subject to and is totally unrelated to the provisions of The Real Estate (Brokers and Salesmen) Act, 1995,” the DIR said.
According to the DIR, for years, the failure to engage in regular valuation exercises meant people who built new homes but did not register them, did not pay any taxes. In many cases, the DIR said people in high-value properties were paying far less than their fair share of taxes while others were compliant.
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