A prominent businessman has argued that it is wrong that the government will not tax the numbers industry “which wants to be taxed” and could have provided “hundreds of millions in revenue”, while seeking to impose valued added tax (VAT) on the rest of the business community.
Ethric Bowe, head of the Carmichael Business League and president of Advanced Technical Enterprises, suggested that the government’s decision to implement VAT was in part fueled by the public’s decision to vote ‘no’ on regulating the numbers sector.
However, he charged that the government should look again at taxing the unregulated and highly profitable sector.
“Just recently we had an opportunity to raise $100 million a year reliably with a tax that would’ve been welcomed by the people who would’ve been taxed. We had $100 million right there, we voted on it and we said ‘no’. We had a choice, tax those fellas over there who are willing to be taxed. We said no but we still need the money, so now we have to go to someone else.
“We ought to tax every enterprise in this country. I can’t be making $100 million and not pay taxes; something is wrong with that.”
In January of 2013, the
government held a referendum on whether to regulate the numbers industry. In a vote in which turnout was reportedly low, Bahamians rejected this possibility and to date operators have continued to conduct business as usual.
On Monday, Stephen Thompson, the recently-appointed coordinator for the National Anti-Money Laundering Taskforce, suggested that “discussions” are again underway on regulating the sector. He argued that anytime an unregulated sector exists that generates “millions”, regulation is “the only responsible thing to do”.
Thompson suggested an external review of this nation’s susceptibility to money laundering could prompt renewed scrutiny of the numbers sector, along with many other financial sectors, as a national risk assessment is undertaken to document potential weaknesses.
However, it is not clear what direction the government will take with respect to numbers.
Bowe said he harbors deep reservations about the ability of the government to implement VAT by July 2014, calling it “impossible” due to a “lack of capacity”.
He added that companies will have trouble accessing the private accounting resources they need to implement the new tax.
“We really have some questions to answer because the resources we need to comply, we don’t know where they are coming from. We’ve been trying to recruit bookkeepers for the normal running of our business and we have issues of the most difficult kind. I don’t see how we are going to be able to do it throughout the nation by July (2014),” said Bowe.
The businessman feels that ultimately Bahamian fiscal woes cannot be corrected without addressing low levels of productivity in The Bahamas.
“We have got to get our productivity up. Fundamentally it will take teaching and preaching and we need all our pastors and churches to keep telling Bahamians we must deliver a full days pay for a full days work.
“If I am paying you $9 an hour you’ve got to produce more than that for me. We must get productivity and service up in The Bahamas because we are in dire straits. It’s our core problem.”
Source: The Nassau Guardian