The Tribune

By YOURI KEMP

Tribune Business Reporter

ykemp@tribunemedia.net

FNM leader Michael Pintard says the government needs to clarify its position at the cabinet level on reducing Value Added Tax (VAT) on breadbasket items.

Mr Pintard told Tribune Business that Michael Halkitis, Minister for Economic Affairs, “has minimal influence” on how some of the critical decisions are being made in the Ministry of Finance.

Prime Minister Philip “Brave” Davis is the substantive minister and delegates most of the important decisions to his financial secretary, Simon Wilson, Mr Pintard said.

He added: “One of the problems this administration is having is that you have three different positions oftentimes being expressed on very critical issues. That sends the wrong message both to the doormat domestic and the international arena.”

The issue over the reintroduction of VAT on breadbasket items has raised questions over the governing Progressive Liberal Party’s claim of helping the poor and marginalised.

On January 1, the Davis administration reduced VAT to 10 percent from 12 percent on all items, however they re-introduced VAT on breadbasket items that were before then zero-rated to 10 percent.

Mr Halkitis has defended the government’s position of raising prices on certain breadbasket items, referring to the matter as commonplace and happens all the time during the budget year.

Mr Pintard also said: “The breadbasket issue is a similar kind of situation where the Prime Minister has created an expectation that we would have seen a reduction in the costs of bringing in containers in the country and that would have an impact on the cost of a number of things inclusive of bread basket items.

He added: “Well, what he has promised that would produce relief in that regard, because looking at the container prices, has actually not happened and it appears that the reverse is happening.

“So rather than provide relief, what we’re seeing is additional burdens being put on the Bahamian people. We acknowledged that some of those increases in price have absolutely nothing to do with the domestic market and is driven by international issues inclusive production capacity and in the states in the other countries where goods originate.”

Regardless of the imported inflationary pressure, Mr Pintard said: “The role of national government is to mitigate against international pressures and so when a prime minister promises that his discussions had borne fruit and that container prices are going to go down, wholesalers are going to cooperate with him, which I haven’t heard the wholesalers verify that they are, then we are expecting some results.”

Noting the government should still speak with one, clear voice on the matter, he said further about the removal of VAT on breadbasket items that “none other than the minister for education, Glenys Hanna-Martin, says her desire is for VAT to be removed from all breadbasket items”.

He added: “Certainly she is a senior person in our parliament, widely respected and highly regarded, and who represents a grassroots area so she knows first-hand the pressures that are on our people. She is saying that VAT should be removed off of all food items.

“So again, Mr Halkitis who is not a very influential voice on these matters, the primary voice is the Prime Minister and the second voice is the financial secretary.”