The Tribune

By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

A Bahamian beverage manufacturer yesterday warned that the proposed "sugary drink tax'" will be a "killer" for its business, saying: "They're trying to get rid of the industry."

Geoffrey Knowles, Aquapure's operations manager, told Tribune Business that the local drink manufacturers should not be singled out to fund the revised National Health Insurance (NHI) scheme.

"That's going to be a killer for us," he said. "They reduced the duty on fruit-based drinks, and now they're talking about a tax on sugary drinks. They're trying to get rid of the beverage industry so they can import what they want I suppose. It's not a good idea; it's too many other hits. If you're talking about health, we need to look at the peas and rice, the macaroni and that sort of thing."

Walter Wells, Caribbean Bottling Company's president and chief executive, in a recent interview with Tribune Business also hit back at plans to raise between $4-$10m from a "sugary drinks tax", arguing that these products cannot be blamed for The Bahamas' health crisis.

Mr Wells said the proposal - intended to create a funding stream for the restructured National Health Insurance (NHI) scheme - was "too narrowly focused" on a sector that cannot be blamed for obesity and other chronic non-communicable diseases (NCDs).

Mr Knowles said he agreed "100 per cent" with Mr Wells's assertions, although the "sugary drinks tax" proposal has yet to move beyond the concept stage, and would have to be both approved by Cabinet and legislated by Parliament. No rates or collection mechanism have been specified, but the NHI consultation paper indicates it is very much at the front of the Government's thinking.

"This is ridiculous. We have VAT and then they are taking about a two per cent payroll tax for NHI," Mr Knowles added. "It's a comedy of errors. It certainly doesn't give me a lot of confidence to invest in manufacturing. Legitimate business people are getting killed in this country. It's just one more thing on top of the other."

Listed among five potential NHI funding mechanisms, the consultation paper said: "Jurisdictional research indicates that 'sin' taxes on particularly unhealthy products, such as sugary drinks, alcohol and cigarettes, are effective revenue sources and create an economic and social incentive to reduce consumption.

"Under our proposed plan, a 'sugary drinks tax' structure will be developed for sugary drinks and potentially other unhealthy products. The funding generated by this tax will be earmarked and flow directly into health education and outreach programmes."