The Tribune

By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

THE Government should consider granting the Bahamas Electricity Corporation (BEC) a two-year tax holiday, the head of the union representing its line staff said yesterday, arguing that this would help the utility monopoly “catch itself”.

Speaking at a meeting of the Rotary Club of West Nassau yesterday, Stephano Greene, president of the Bahamas Electrical Workers Union (BEWU), said the move would translate into immediate relief for consumers burdened by high electricity costs.

“The union’s recommendation to government is to stop taxing BEC, even if it’s just for a year or two years,” Mr Greene said.

“We could bring that fuel cost down, and that would assist us in reducing the cost of electricity to the consumers. If you look at your light bill, the fuel cost is a major portion of your light bill and that fuel cost needs to be reduced.

“The other smaller portion pays all the bills at BEC, and so the fuel cost is the piece that needs to be really looked at because that’s the highest portion. The second they take the tax off that, you can realise an automatic reduction in the cost of electricity.”

“The other issues, like the servicing of the generators and the other things the Corporation is trying to do, are long-term fixes. The immediate fix would be to relax the tax on fuel and the equipment that BEC brings into the country, so that BEC could catch itself and customers would catch themselves,” Mr Greene told Tribune Business.

A two-year tax holiday was implemented under the former Ingraham administration, ceasing at the end of the 2009-2010 fiscal year. The Government had granted the Corporation a two-year suspension of 10 per cent Customs duty, plus the 7 per cent Stamp Duty on fuel imports, in a bid to alleviate some of its financial pressures.

Mr Greene added that New Providence was the only island where BEC was recording a profit.

“As far as I know, Exuma used to be profitable a while back, but Nassau is as far as I know the only profitable island right now and really takes the burden of the entire Bahamas,” he said.

“We need to find ways to make the Family Islands more profitable. Maybe we need to look at putting wind turbines or solar on some of the Family Islands or natural gas generators. The system that we have in place right now, and the number of persons on these islands, is just not profitable to BEC.”