Deputy Prime Minister K Peter Turnquest.
By KHRISNA RUSSELL
Deputy Chief Reporter
krussell@tribunemedia.net
DEPUTY Prime Minister Peter Turnquest said while Value Added Tax revenue is behind this quarter, the government fully expects the economy to pick up resulting in better VAT results.
Mr Turnquest explained that the lag was due to a sluggish economy and several other factors; however, he was unable to reveal the estimated collected figure.
He spoke to the media on the sidelines of the Bahamas Business Outlook at Baha Mar on Thursday.
The finance minister said: “From a government revenue point of view (VAT) is a substantial portion of the overall revenue government collects now.
“As you know the cost of governing has increased significantly over the last couple of years and until we are able to get that under control unfortunately we need that additional revenue in order to cover the expenses.”
He added: “We all know that the economy has been a little sluggish for the last couple of years. In addition to that we have a number of circumstances that we are dealing with in terms of clarifying the applicability of VAT on certain industries on certain transactions that have caused some withholding of VAT payments. There are some credits that are due to some industries legitimately and so all of this has some effects.”
Asked whether the government has found businesses to be non-compliant with VAT regulations, Mr Turnquest said this hasn’t been much of an issue.
“No, not at all I think most businesses have been very compliant," he said.
"This is a sort of self policing mechanism. Not to say that there are not those who maybe escaping, but they will be found out in short order as we go through the processes of audits and verification.
“I don’t think that that is significant in number although of course we are aware in any system there is no perfect system and so you will have some leakage but we’re working diligently to plug those holes and to ensure that we have a robust compliant tax system,” he said.
Comments
killemwitdakno 6 years, 9 months ago
So repeal VAT wasn't going to happen.
Repeal VAT on bread basket items isn't going to happen.
Double tax of both duty and VAT will remain.
Huge campaign mandate broken.
At least we got a discount on hybrid imports alrjoughthe Japanese cars may become little harder to get.
stillwaters 6 years, 9 months ago
Just bringing excuses. All I want to know is how much was collected and how it is being spent. Otherwise, don't come to us with stupid talk which says nothing.
Truism 6 years, 9 months ago
So after finding the VAT money and firing plenty people and suspending/terminating plenty contracts we discover that VAT revenue is down. DUH... Fewer persons and businesses purchasing goods and services.
SP 6 years, 9 months ago
“We all know that the economy has been a little sluggish for the last couple of years". Understatement of the decade. 2017 was the worse year for business I've ever experienced and I see no end in sight.
As long as foreigners occupy the majority of blue collar jobs repatriating income out of circulation, the economy cannot help but continue on the present downward trajectory.
Governments tightening the screws by demanding new, cumbersome, verification processes is another death null for small businesses that cannot afford to hire accounting firms.
Supposedly, Peter Turnquest is an accountant that cannot figure out that expatriate repatriations are the main reason for our rapidly shrinking economy!
ThisIsOurs 6 years, 9 months ago
An accountant is not an economist. Accountants see numbers economists see relationships. You may have pointed out the fundamental flaw in selecting KP as finance minister and a marketing manager as his "deputy". But hey I'm not an accountant or an economist so what do I know....
Well_mudda_take_sic 6 years, 9 months ago
I'm happy to wager a pretty penny you know a helluva lot more about public finances than Peter Turnquest could ever know.
SP 6 years, 9 months ago
"Public finances" is not the issue. Keeping capital circulating in the local economy versus flight of capital "out" of the economy is the question.
This is a very simple equation. When a Bahamian is paid on Friday, he is broke by the following Tuesday having spent all of his earnings locally stimulating various sectors of the economy. Compared to when a work permit holder is paid on Friday he repatriates large portions of his earnings to home countries stimulating foreign economies.
We cannot expect the Bahamian economy to "flourish" when spend is constantly eroded by repatriations!
Aegeaon 6 years, 9 months ago
Who knows, that's your government's punishment for siding the cartel in the 80's, and now your society is entitled to be drug-runner instead of an honest citizen. That capital that is going out is being delivered to drug lords in Mexico. Simple as that.
ThisIsOurs 6 years, 9 months ago
Ah, don't waste yuh penny...I know what I know and economics ain't it. I knew enough to wonder if he was a good choice for the position, I consoled myself by saying he'll appoint good technical people to assist him...then he chose a marketing manager...I was confused about that at first but as I saw the quality of other subsequent appointments I realized that this political game has nothing to do with picking the best people and ensuring organizations are running efficiently
sheeprunner12 6 years, 9 months ago
Well ....... Minnis & KPT fired an economist - Mr. Simon Wilson - as Financial Secretary .......... Go figger!!!!!!!!!
John 6 years, 9 months ago
In the main time THE Tribune posted merchants bragging how their holiday sales were better than last year to bragging that they were "greater than expected." Everyone knows the economy took a nose dive since the Elections in May and the past Christmas season was the worst in recent years. Retail sales were Very down. The US, however, saw much improvement, especially in the malls and brick and mortar stores. Their unemployment is probably below 4% while ours is still at least 11 or 12%. Higher in Freeport and on some Family islands. Fortunately the strong numbers in the hotels and the recent hiring at Bah Mar will inject new money into the economy. But the government must start several major projects here in New providence, in Grand Bahama and on several Family Islands. not only to kick start the economy, but to boost consumer confidence and get the private sector to invest. Then we should see some improvement by March!
SP 6 years, 9 months ago
"Public finances" is not the issue. Keeping capital circulating in the local economy versus flight of capital "out" of the economy is the question.
This is a very simple equation. When a Bahamian is paid on Friday, he is broke by the following Tuesday having spent all of his earnings locally stimulating various sectors of the economy. Compared to when a work permit holder is paid on Friday he repatriates large portions of his earnings to home countries stimulating foreign economies.
We cannot expect the Bahamian economy to "flourish" when spend is constantly eroded by repatriations!
Dawes 6 years, 9 months ago
Do you have any statistics for the work permit holders repatriating the money?
TalRussell 6 years, 9 months ago
Go figure, hey?
BONEFISH 6 years, 9 months ago
DPM Turnquest had nothing to do with that decision of the appointment of the new Financial Secretary. That dumb decision iwas made by PM Minnis alone.
ThisIsOurs 6 years, 9 months ago
That's interesting...
sheeprunner12 6 years, 9 months ago
That may be so ........ But Minnis AND the Cabinet is responsible for the FS hiring .......... and the public has still not been told what the new FS contract entails.
bogart 6 years, 9 months ago
Excellent baseballs skills in throwing a curve ball that did a pretzel type motion. VAT was so excellently done that everyone commented on its efficientcy. Most ever monies collected to pay down debt.
IF however past years economy has been sliggish, however governing has increased over the last few years, but many are recently laid off, but salaries are up, funds poured into losing agencies etcetc The Minister cannot say how much has been collected but VAT revenue has been down this quarter.
It is one thing to hear aspiring politicians before elections make some convincing speeches amd when elected it is watered dowm seemingly so because some secretarial speechwriter who has done it for previous politician does not want to contardict what position and perhaps policy they had written in previois speeches.
SP.....comment on finds repatriated is an obvious drain and figures should be 100 million plus from dome 85m many years ago.
What was never looked into was businesses raising the 7.5% to higher amount to cover administratiive costs. Private associations were trying to raise 5,000 meals, 10,000 meals, donations to the needy etc and the Minister should know what dat means.
Serious consideration should be given to forensic investigations and selling entities like the Bank of the Bahamas requiring injections of some 300 million plus share price falling from some $5.22 to now around .92cents. Govt ownership has lost from share price drop also. 300 million could have been used in Freeport to create thousands of jobs and workers spending and govt to collect VAT.
BahamasForBahamians 6 years, 9 months ago
Wait..
This same dude told me the VAT money was stolen.
How can the VAT collections be down from 0? Wasnt it stolen ? Any collections should be an increase?
Or was he LYING?
proudloudandfnm 6 years, 9 months ago
Guarantee most of this is due to Freeport's current situation...
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