The Tribune

By KYLE WALKINE

Tribune Staff Reporter

kwalkine@tribunemedia.net

THE government has lost focus on preparing the nation for the January 1 implementation of value added tax and has decided to now focus its energy on other issues that are not as important, said FNM Shadow Finance Minister Peter Turnquest. 

Mr Turnquest yesterday described the government’s silence on VAT education and preparedness as “deafening”. 

“We appear to be falling into the same situation as before,” he said. “The VAT date is looming with little education again. However, we know that the government appears to be focused somewhere else, namely web shop regulation.”

“This VAT will have a much more significant impact, not only on the cost of living, but the tax structure.

“If it is going to be the replacement revenue generator then we certainly ought to be giving it the widest consultation and education possible.”

While giving his annual budget communication earlier this month, Prime Minister Perry Christie announced that the new tax will take effect on January 1, 2015 at a rate of 7.5 per cent. 

The government had initially planned for VAT to be implemented next Tuesday, July 1. However, after consultation with VAT experts from New Zealand, the date and rate of VAT was changed. The government had initially proposed a VAT rate of 15 per cent.

Prior to delaying the tax, the business community and members of the opposition criticised the government over lack of education about the new tax. 

Mr Turnquest said with the implementation being just a few months away there are still too many questions to be answered.

“As far as tabling legislation in Parliament, that has not been done and who knows when it will be,” he said. “I recommend they do it as soon as possible. The public ought to have a reasonable time to digest the legislation and analyse it. The draft is obviously very voluminous and has a lot of technical data.”

Mr Turnquest said that when the legislation is tabled the government should give parliamentarians a minimum of two weeks to consult with their advisors and constituents so they can present the best possible debate in Parliament. 

The East Grand Bahama MP also noted that the government appeared distracted from VAT preparation and cited the planned Carnival celebration, which should be launched early next year, as one event taking its focus away from the tax overhaul.

“I think the Carnival thing is kind of a distraction,” he said. “The main focus has got to be what is the sustainable and fundamental shift on our tax structure.

“The most important issue to be dealt with right now is VAT. They’ve got to tackle that head on and stop leaving the Bahamian people wondering what’s going to happen, how it’s going to be implemented and if we’re even ready for it.”

Mr Turnquest said the fact that the government wants to implement the new tax on a public holiday will be “very interesting” as the entire month of December through the first week of January have proven to be a time when productivity is minimal in the country.