The Tribune

• Impact likely ‘deeper’ than govt realises

• Reformer waited 15 months for tax refund

• ‘Accelerated efficiency’ for public sector

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Bahamians face “a rude awakening” once COVID-19’s true economic and fiscal costs are revealed, a governance reformer warned yesterday, as he called for “accelerated efficiency” in government.

Robert Myers, the Organisation for Responsible Governance’s (ORG) principal, told Tribune Business that the devastation inflicted by the pandemic was likely to be “deeper” than the government both knew and was disclosing.

Suggesting that the full picture will provide an unpleasant surprise “when the dust settles”, he argued that improving the ease and cost of doing business via improved public sector performance was critical to jump-starting The Bahamas’ ability to grow its economy back to health.

With ORG urging that greater government efficiency, and improved fiscal management, must come before any imposition of new and/or increased taxes, Mr Myers cited numerous examples of public sector red tape and bureaucracy that continue to stifle the private sector and possibility for greater domestic and foreign direct investment (FDI).

Citing his personal 15-month wait to obtain a tax refund from Customs, the ORG chief said he had heard numerous complaints from other business executives about agencies such as the Department of Environmental Planning and Protection (DEPP) and the Town Planning Committee “dragging their feet” on permits and approvals.

The inability to pay utility bills online because digital portals were not functioning was another issue, while Mr Myers echoed concerns voiced this week by David Morley, Morley Realty’s principal, about businesses and homeowners having to first pay disputed tax amounts before they can appeal these levies.

Acknowledging that the government, and by extension, The Bahamas, are “in a real predicament” that is not of their making due to the global economic devastation inflicted by COVID-19, Mr Myers said the local fall-out will likely be “deeper” than what the Minnis administration realises and is letting on.

With The Bahamas in “good company” with other countries when it came to elevated debt and unemployment, he added: “I think when the dust settles and the numbers come in, and people look at where we’re at, it will be a rude awakening.

“We know times are desperate because the government is giving money out and businesses are hurting.... Now, because of COVID-19 and the pain it has caused the country, we have to accelerate the efficiencies in government.

“It doesn’t help that the DEPP is dragging their feet on approving projects. I’ve heard the complaints from people that are in the know. It’s the same with Town Planning and building permits. The ease and cost of doing business has not come down. If you want to make it easy for foreign direct investment to occur, get all the impediments out the way and get some money flowing here,” he added.

“We cannot keep talking and doing nothing. That’s what we’ve been doing. Talking and doing nothing. The ease and cost of doing business has got worse, not better.”

Explaining that he was speaking from personal experience, Mr Myers told Tribune Business: “It took me a year and a quarter to get a simple refund back from Customs. God knows how many phone calls. We’d shipped in the wrong piece of equipment, and ended up shipping it in and shipping it back out.

“Rather than make it easy Customs made us pay for it again and get a refund. A year and three months later we get it back. They [the Government] are getting some things fixed, but not fast enough and then they are adding other complexities.”

Mr Myers referred to the recent “substance reporting” requirements that all Bahamian firms had to comply with to meet the European Union’s (EU) demands, adding: “If it’s not one thing then it’s another.

“If they levy a tax and the amount is incorrect, you cannot complain until you pay the disputed amount, whether it is a Business Licence fee, VAT, real property tax of Customs,” he said. “How is that good governance. Change the law and make it more business friendly.

“Without a mechanism to appeal at all unless you pay the tax, you go into a cash deficit and can only hope to get the money back from the Treasury. If they hold an investigation there’s no idea how long that will take. You won’t attract investment to the country when stuff like that kicks in. None of these things help us move forward.”

Questioning where the Tax Appeals Commission was, Mr Myers described the tax refund and appeals process as “antiquated” and in drastic need of change. “They have to catch up with the times,” he added.

Digital payments, too, are in need of rapid improvement with the ORG chief disclosing: “I have paid my BPL bill online for however many years. I tried to pay it online at the weekend and it was denied; it wouldn’t go through because their portal was not working.

“I did not know what the problem was. I tried calling BPL, their customer service line and every number I can find. Nobody answered. We have to do better. As a people, as a public sector, as a private sector we have to work harder; all of us. It ain’t going to happen by wishing and praying. It only gets you so far, and we’re in dire circumstances now.”

ORG, in a statement, urged the Government “to address the internal and structural changes needed to reduce the deficit and stimulate the economy. These include increased digitisation of government, increased public service efficiency and effectiveness, the adoption and adherence to the National Development Plan, and investment in public service leadership and management capacities.

“Public sector reform legislation mandating accountability in and between government and the public sector can increase government efficiency and effectiveness by giving consistency and structure to government decision-making, and ensure that political agenda does not drive actions or spending.”

ORG added that “public service reform toward effectiveness and efficiency, and increased levels of fiscal management and monitoring, must be prioritised before” the introduction of new and/or increased taxation.