The Nassau Guardian
Minnis defends VAT position
Free National Movement (FNM) Leader Dr. Hubert Minnis said his party has not flip-flopped on the issue of value-added tax (VAT) and explained that had the FNM been re-elected in 2012 the matter would have been handled “properly”.
Minnis came under fire from the Progressive Liberal Party (PLP) last week after he criticized the government’s plans to introduce VAT next July.
Although his party had planned to give VAT “early
consideration if re-elected”, Minnis called the new tax “regressive” last week.
Minnis’ statement drew rebuke from PLP Chairman Bradley Roberts, who said the comments were misguided.
Yesterday, Minnis defended his party on the VAT issue. He said he could not say how soon the FNM would have introduced VAT if it had been re-elected.
“That’s not flip-flopping because the FNM would have ensured that proper analysis was done,” Minnis said.
“The FNM would have ensured that the process would have been right. The FNM would have ensured that people were informed properly, and the FNM would have ensured that people knew exactly the state of the economy and what we are trying to do.
“And at the same time we would have improved on the [existing tax] collection that the people are concerned about. We would have decreased [public] wastage.”
Former Minister of State for Finance Zhivargo Laing has said the former administration had planned to implement VAT, and would have done so within “two to three years” if the FNM was re-elected in 2012.
Laing has also said the International Monetary Fund (IMF), the Inter-American Development Bank and the Ministry of Finance conducted studies on whether VAT or a sales tax should be implemented in The Bahamas, and a proposal was submitted to the government.
In a speech he delivered to the Rotary Club of Freeport in August on the implications of VAT for The Bahamas, Laing said that proposal formed the basis of the current proposal before the country.
Laing and Minnis were both a part of the Ingraham Cabinet.
Despite his critique of VAT, Minnis did not offer an alternative tax model to get the government out of its debt crisis.
However, he said if the government aggressively collects the hundreds of millions of dollars in outstanding taxes, a new tax model would not be needed.
“If you don’t plug the leakage, regardless of what tax system you put out there, the leakage will continue,” he said.
He added that there are many unanswered questions on the tax and criticized the government for not giving enough information on its plans.
Minnis said it is a “joke” that the VAT legislation and regulations have not been released eight months ahead of the proposed implementation date.
Poll
The FNM has begun polling residents to gauge the public’s feelings about the new tax.
Since Friday, Minnis said 200 constituents of Killarney have responded to an online poll on the issue.
He said when asked if the government should introduce VAT, 77.2 percent said no, 14.6 percent said yes and 8.4 percent said they don’t know.
When asked what form of new taxation the country should implement, 13.5 percent said none and 86.5 percent said other tax models, including a sales tax, income tax or payroll tax.
The Killarney MP said similar polls will be conducted in all FNM constituencies, beginning with St. Anne’s.
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