By KHRISNA VIRGIL
Tribune Staff Reporter
kvirgil@tribunemedia.net
THE government expects to start consulting with members of the public this week on which food items and materials are to be exempted from value added tax (VAT).
Minister of Finance Michael Halkitis said officials wanted to ensure consumers were not faced with extreme hikes at grocery store cash registers when VAT is implemented from July 1, 2014.
A public dialogue is due to begin some time this week, he said.
While the government has faced criticism for its formulation of a white paper which largely explored the implications of that system compared to other forms of taxation, the minister said it was thought that VAT would be sensitive to the financial stability of poorer Bahamians.
He said: “You have categories that will be exempt like basic food so the system does not pile taxes on the people. So it’s not a flat rate that will be applied on items.
“In most countries, and there are around 150 them, basic food supplies, books, medicine and educational and financial services come in that category. We intend to follow that same type of thing. But the public will decide on the items they’d like to see exempt.
“This is not something where taxes will be heaped on the people.”
When asked why the government sought to implement VAT and not an income tax regimen as does the United States, he said that form of taxation was just too “radical.”
He added that in an effort to ensure Bahamians are well versed on how VAT would work and affect them, an aggressive public relations campaign is planned to begin next week.
“Initially, only 100 white papers were printed but we intend to print a few thousand more to distribute among members of the public. Our intention is that it will be a much more condensed and simple version for their understanding.”
According to the white paper on ‘Tax Reform to Secure Adequate Revenues for the Future’ VAT will be introduced at a rate of 15 per cent. The government believes that the rate would ensure that there is sufficient access to adequate revenue.
VAT is now a consideration as the current taxation system largely relies on customs duty on imports.
Apart from loopholes which affect the revenue generated, there are several concessions which only allow a relatively small portion to be collected.
Proposed legislation to govern the system will be planned and drafted this week.
Comments
Ironvelvet 11 years, 9 months ago
As a health professional, I fear that the unhealthy foods will not be taxed and the healthy ones will be. This has been documented to increase the health disparity in the lower socioeconomic populations.
I hope we take this under consideration when considering which foods will be exempt.
Also, 15% seems a bit high on already high priced foods. Does this mean that the price of the foods will come down to accomodate this VAT? I always thought that the food was highly priced to pay for the tax that the grocery stores had to pay. Would hate to see a bottle of OJ go from $9.00 to $10.35. OJ people, OJ.....tha'ts not even counting inflation and minimum wage was raised when? I see a gouge coming.
TalRussell 11 years, 9 months ago
Comrade State Minister Michael, first things first.The PLP government would have to get back in touch with the values of the Bahamian people, before even claiming to understand the real issues that face every-day hard working Bahamians?
I don’t really know anymore what this PLP has become? If what we have seen emulating from how this government has been mishandling just about every damn thing they have touched, is all the taxpayers have to compare this government's performance record to, now about to reach their first full year in office, Comrades the people have good reason to be scared as hell about even holding onto their paychecks?
If I were a PLP MP I would be as concerned about how much longer I will hold onto my own House seat paychecks?
For all you PLP MP's that like the numbers "bosses" so much, unless there are sensible, real progressive changes within the PLP government, to "add value" to how the peoples business is to be handled, seriously, I wouldn't be betting on you making it "all the way" to May 2017? Yes, there is yet a big price to pay for the failure for not even one of you PLP House MP's-being willing to speak out against the number "possess: taking the peoples votes to the Supreme Court? The payback is still to come.
If I didn't know better, I'd be thinking from the way you all's been acting, that you're all be in the House of Assembly, sipping from the same Mickey bottle?
http://tribune242.com/users/photos/2013…
akbar 11 years, 9 months ago
Speaking of the PLP an interesting thing happened today. I went to a jobsite where my stepfather who works for BEC was doing an apparent disconnection ,to give him something.. Shockingly the Chairman of the Corporation pulled up and began ranting and raving. I sat in my car and it appeared that he was carrying bad and telling them to turn this consumers light back on! I could not believe what I was seeing! The person who I assumed was the supervisor was trying to be as calm as possible but the Chairman took of his coat and began acting in a threatening manner. Wowwww this is totally unbecoming and I began to wonder if the Chairman was losing his head or if he was that drunk with power! This present government is only its first year and seems to be a failure. I have never witness anything like this from a public official. These guys are frauds and want to take this country to the level of political victimisation and intimidation pre 1992. Warning to them this is the age of information these things could be post on a social media outlet in a minute. I was dismayed and my faith in my elected officials went to an all time low. How do expect the young folks to act if a senior government official acting in the street like a rabid dog. Astonishing and only in the Bahamas.
jackflash 11 years, 9 months ago
Prove it!
Did you get photos?
Then post them.
concernedcitizen 11 years, 9 months ago
LONG AS WE KEEP REWARDING OUR ILLEGETIMATE, OUT OF CONTROL BIRTH RATE WITH GOV JOBS ,,,WE GOT TO KEEP TAXING ,,NEXT TIME YOU HEAR A MAN BRAGGING BOUT HAVING 20 KIDS OR A SINGLE WOMEN W/ 6 KIDS THANK THEM FOR THE HIGH TAXES WE PAY !!!!!!!!!!!!!!!!!!!!!!!!!!!
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