The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Abaco’s Chamber of Commerce president yesterday urged that Business Licence rates for small farmers be slashed in today’s Budget and that Family Islands be allowed to retain a portion of their tax revenues.

Daphne DeGregory-Miaoulis, a farmer herself with Abaco Neem, told Tribune Business that farmers face paying a Business Licence rate that is “higher than for most businesses”, which she branded as “absurd” given this nation’s need to boost food security and the fact store prices are “astronomical”.

Besides requesting that the Government to fix this when it unveils its 2024-2025 fiscal plan, she also called on it to fulfill the promise it made in the 2022-2023 Budget - and which is now contained in law in the Public Finance Management Act - and allow Family Islands to keep up to 25 percent of the real property taxes and Road Traffic Department fees collected in their respective locations.

Mrs DeGregory-Miaoulis argued that Family Island communities, island administrators and local government authorities/district councils are far better placed than the central government in Nassau to determine what their most pressing needs are and direct funding where it will have the greatest impact.

Asserting that it is past time to “decentralise” The Bahamas’ governance structure, she argued that Abaco would be “the perfect place” to trial this idea. The Abaco Chamber head also said that allowing Family Islands to reinvest a portion of their taxes back into the community would “have full transparency, which is not something we get from our national government”, with audits verifying how funds were spent.

“The price of food is astronomical,” Mrs DeGregory-Miaoulis told this newspaper. “There’d better not be any tax increases, that’s all I can say. We’re hoping for no tax increases. I’m also hoping they would have made better concessions for farmers and dropped the Business Licence rate from 7.5 percent to 5 percent.

“They have it at a full 7.5 percent. There’s no sliding scale, and the smaller farmer has to pay a higher tax rate than most businesses, which seems pretty absurd when we need food security. In fact, anybody under $100,000 should be completely exempted. We struggle as it is.”

Mrs DeGregory-Miaoulis then called on the Government to fully implement what Prime Minister Philip Davis KC had first promised in the 2022-2023 Budget some two years ago. He said then: “We have allocated 10 percent of overall revenue collected in the Family Islands from property tax and road traffic fees to the creation of a Family Island Development Trust Fund in the amount of $200m.

“This fund will facilitate the Government in making immediate and significant investment in Family Island infrastructure. This fund would be a sub-fund of the National Infrastructure Fund. We also propose to leverage the aviation-related revenue to create a fund for aviation infrastructure, which would be another sub-fund of the National Infrastructure Fund.

“This, combined with the Family Island Development Trust, will accelerate the reconstruction of Family Island airports. It will also end the practice of Family Island infrastructure improvements being made a lesser priority than infrastructure improvements in New Providence,” the Prime Minister continued.

“It is important to note, however, Madam Speaker, that this does not mean that we will exclude Family Island projects from future capital budgets of the Ministry of Public Works. Far from it. It just means that the Family Islands will have their own dedicated fund to ensure that they keep pace with national development.”

This was retained in the Public Finance Management Act 2023, which was passed last year. Clause 52, section four, which deals with the Government’s consolidated fund, stipulates: “Revenues derived from real property tax collected under the Real Property Tax Act in respect of property located on a Family Island, and all taxes and fees collected on a Family Island under the Road Traffic Act shall be utilised to defray expenses and fund expenditures of that Family Island.”

The 10 percent retention percentage mentioned by the Prime Minister was just the start, and only a minimum. While it began at that threshold in the 2022-2023 fiscal year, the percentage of real property taxes and Road Traffic fees retained by each Family Island were to increase to a minimum 17 percent in this fiscal year, and then to 25 percent for the upcoming 2024-2025 Budget year.

The percentage will then remain at that benchmark in all subsequent years, but Mrs DeGregory-Miaoulis said she was unaware of this ever being put into effect thus far. “I would very much like them to implement that,” she told Tribune Business.

“I think what they ought to do is develop more island states where we, the leaders of our own island states, determine where the taxes are spent. We are the ones that know more than anyone else what we need.”

Suggesting that Family Islands should be allowed to retain 75 percent of the taxes they generate, although the Government would likely resist such an amount, Mrs DeGregory-Miaoulis said: “We’d fix the things that are needed to improve conditions which, in turn, will generate greater revenues and the Government will end up making more money doing that.

“It’s time to decentralise government, and to put the management of the islands in the hands of the people who know what is needed most of all. They’ve [successive administrations] all talked about it but no one has put any meat to it. It’s just been all talk. It’s about time. I think the Government that does this will be very much well received.

“I would very much like to see more autonomy given to local administrators and the movers and shakers in various islands. Abaco would be the perfect place to use this as a template to start this effort. I would like to make that point very strongly. I think Abaco would be a great island to use as a pilot to demonstrate its effectiveness,” the Abaco Chamber chief continued.

“They talk about wanting to implement local government, even in Nassau, but how do you do that if you don’t even trust them to manage their own money and, by the way, we would have full transparency, which is not something we get from the national government.

“We could be audited, have our books open for examination, have proper record-keeping and clearly demonstrate where the money is being spent and how it’s being spent as opposed to now where the money goes into the central coffers and we have to guess as to who it’s going to and where it’s going.

“I would very much like to see that implemented, and because Nassau doesn’t appreciate what the needs are at the local island level, because they are not here day-to-day, there’s nobody better than us that knows what our direct challenges are,” Mrs DeGregory-Miaoulis said.

“We are the ones who should be able to have a say in how things are corrected and what improvements are really going to have an impact on our quality of life and our visitor experience. When they sit around the round table in Nassau making decisions, they don’t know what we’re having to deal with and what improvements need to be made.”