The Tribune

By YOURI KEMP

Tribune Business Reporter

ykemp@tribunemedia.net

Abaco’s Chamber of Commerce president yesterday warned the island “won’t be back up to speed for June 30" when the reconstruction tax breaks expire due to the need to “get past COVID-19".

Ken Hutton told Tribune Business that the worldwide pandemic, and subsequent health protocols and restrictions implemented by the Government in response, had slowed the pace of Hurricane Dorian-related rebuilding.

The Special Economic Recovery Zone (SERZ) relief package, created by the Government to provide some relief to businesses and homeowners and speed-up the restoration process, together with the accompanying tax exemptions, are set to expire at mid-year having been extended from year-end 2020 but Mr Hutton indicated this may not be sufficient.

“We are still not able to get people back to rebuild. Plain and simple. So it doesn’t matter what the concessions are if people aren’t here to take advantage of them. As helpful as they are, they are not as useful as they could be," he said.

“We appreciate the position of the Government in terms of its revenue, but I would say that the revenue in Abaco is not going to come any faster until we are able to get rebuilt and operating again at the same level, and that is going to take time. It’s going to take money, and it is going to take concessions to be able to get that done as quickly as possible."

Mr Hutton spoke after the Prime Minister, on Friday, said the Special Economic Recovery Zones (SERZs) have provided more than $105m in VAT, Customs duty and Excise tax breaks to aid Hurricane Dorian reconstruction.

Besides these exemptions more than $11m in business license fees have been waived for 4,475 companies based in the storm-devastated areas of Abaco and Grand Bahama. A further $6m has been disbursed by the Small Business Development Centre (SBDC) to micro, small and medium-sized enterprises (MSMEs) to aid their recovery, with the Government providing some $138 million in direct support to Dorian-hit families and businesses during the 2019-2020 fiscal year.

Mr Hutton, though, said the island must “get past COVID-19” before the tax breaks and other incentives end. The government in December extended the VAT waiver on fuel sales, as well as on furniture, fixtures and appliances, hardware, building materials, fixtures and related items, until June 30, 2021.

Mr Hutton said he subsequently wrote to the Ministry of Finance, on the Chamber's behalf, on what items should be granted tax waivers but has received no response since his letter was sent on January 13.

He added: “The Chamber wrote a letter to the Government back in January when they came out with the extension of the concessions, giving suggestions as to which specific tariff headings should qualify. We have never received a response. So we need an acknowledgement of that letter.

“We're trying we're trying to work with government. We are trying to partner with government and give them our suggestions. But, you know, we had zero acknowledgement or even a response to our letter.

"They have done some interesting things without any explanations, like building materials, furniture, fixtures and equipment, duty and VAT free, but that does not include air conditioners. Now tell me a house here that doesn’t have an air conditioner? It also doesn’t include mattresses either. Now tell me a house that doesn’t have a mattress.”