The Tribune

By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

THE opposition yesterday predicted an “even greater revenue shortfall” and missed fiscal deficit targets, arguing that the mid-year budget “did nothing to inspire confidence”.

Chester Cooper, pictured, the Progressive Liberal Party’s (PLP) deputy leader and finance spokesman, accused the Minnis administration of managing The Bahamas for the International Monetary Fund (IMF) and rating agencies rather than the Bahamian people. He added that it appeared to be operating with “head and no heart”.

Slamming the Minnis administration for what he deemed “an arrogant lack of consultation” with various industries, Mr Cooper added that the “ill-advised and poorly executed” handling of the VAT rate hike and taxation of web shop operators had led to what will be a “significant revenue shortfall”.

He also charged that disbanding the Revenue Enhancement Unit established by the former Christie administration, and the delay in reforming it, has also proven to be “folly” as shown by the potential loss of $80m in projected revenue.

“We heard nothing to inspire confidence,” Mr Cooper said. “At half-year, revenue projections are only 38 per cent of annual projections, down against projections despite the painful 60 per cent increase in VAT.

“This government has put yet another revenue enhancement unit in place, and the $80m in lost revenue it promised it would capture was just another empty promise. This amounts to around a $200m shortfall by the Government’s own calculations. We expect that, at the end of the day, it will be an even greater shortfall and the deficit predictions will be missed.

“Now they will seek to further starve capital expenditure that will help Bahamian contractors and small to medium-sized business owners. In the meantime vendors, cannot get paid and schools remain in disrepair.”

Mr Cooper also asserted that any economic growth was only as a result of projects brought on stream by the former Christie administration. “The potential projected GDP growth, while good news - and while it has little or nothing to do with this administration - we restate that it matters not if Bahamians cannot feel the growth in their lives and pockets. The foundation of this growth is PLP projects, mainly Baha Mar and the Pointe,” he added.

Mr Cooper also fired back against criticisms over the “mountain of arrears” inherited by the Minnis administration, saying: “We are in year two of this administration. We’re not going to encourage deflections from this administration’s management, or lack thereof, of the economy.

“We want to talk about the current state of affairs, the borrowings they did since they came to office; how they dismantled the Revenue Enhancement Unit; said that they didn’t, and now say that they are going to put it back in place during the second half of the year. We’re concerned about the inconsistencies. We’re more concerned about the revenue shortfall we see as a result of putting aside good initiatives that the PLP left in the pipeline.”

K Peter Turnquest, deputy prime minister and minister of finance, yesterday said the fiscal deficit contracted by 31 percent or $78.7 million to $175.3 million during the first half of the year.