The Tribune

• PwC chief says crime threat 'matter of priority'

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A SENIOR accountant yesterday suggested The Bahamas should "pause" to assess whether its tax structure and mooted reforms are making the jurisdiction sufficiently attractive to investors.

Prince Rahming, PricewaterhouseCoopers (PwC) territory manager, told the Bahamas Business Outlook conference that an "important message" is being sent to policymakers because investors of all sizes are voicing concern over this nation's "tax environment".

He added that Business Licence reforms, where companies with annual turnovers exceeding $5m must now verify the accuracy of their submissions by providing full audited financial statements, and proposals for the introduction of corporate income tax are causing investors "to rethink the financial models" that first brought them to The Bahamas.

Mr Rahming also urged the Government to tackle rising crime, and the soaring murder rate, as "a matter of priority" because it threatens to undermine the "health" of The Bahamas' brand reputation in the international marketplace and thereby deter further investment.

Noting that PwC's Bahamian subsidiary works with multiple investors, who are at various stages of their projects and developments in this nation, Mr Rahming said "the ease of doing business often comes up in discussions and the cost of doing business is another element.

"I was on the phone with a client yesterday who told me we need to do a benchmarking against other jurisdictions when we think about the ease of doing business and the cost of doing business," he added. "The Bahamas is a high-cost jurisdiction. That's also in keeping with that because we position ourselves as such. We're a luxury destination, so it's in keeping with that.

"There is a concern around some of the latest discussion around the Business Licence fee, around income tax, that is worrisome to many of these investors. A number of them are having to go back now and rethink their financial models which brought them to the country.

"I hazard to say some of the new entities to the country, I've been having discussions with them around the tax environment in the country. It is a cause of concern," Mr Rahming continued.

"That's not to say all of the other elements of The Bahamas are not attractive, but it's at the point where we have to pause as a country to determine exactly how we want to position ourselves from a country perspective and whether or not we are presenting the right elements to make the jurisdiction financially attractive to some of then investors coming in.

"We work with investors large and small, and they are all saying the same thing, which is is an important message to go back to the policymakers." The PwC Bahamas chief also said there was "a bit of concern around the rise in crime" from the perspective of investment flows into The Bahamas, although he praised the Government's recent focus and commitment to addressing the issue.

"I think that fundamentally that has to be addressed as a matter of priority because it impacts the brand's health in the global community," Mr Rahming said. "Therefore, further investment depends on it. In my view, these are the three elements alongside the ease of doing business" that The Bahamas must tackle.