When is the last time in this country’s history you’ve seen so many commercial and offshore banks downsize all within a single fiscal year? The higher operational costs banks have cited as one of their key reasons for downsizing came about because of the surprise business tax increases the government threw onto the country in July of last year.
Businesses had no prior warning for the fiscal year and hence, were forced to make the fully anticipated decision of cutting costs – those costs ultimately being manpower. Major companies saw their operational costs jump by multiplied millions literally overnight last year. Businesses are not going to swallow such a significant and surprise increase in operational costs – they are going to mitigate that increase by raising prices and/or cutting back on their other major operational cost – employees.
When the government recently held a ceremony in Andros to launch its Agricultural Institute, the Prime Minister arrived late, with his Minister V. Alfred Gray telling the audience his lateness was due to a major meeting he was having with the nation’s banks – adding that the outcome of that meeting would be something Bahamians should all thank Mr. Christie for.
Really? Well clearly that was a gratuitous fable on Gray’s part because the only thing banks have announced before and since that alleged “major” meeting is that Bahamians would be losing their jobs.
Outside of the banking sector, last year’s surprise taxes are also the reason we have seen grocery prices increase across the board. And with all the multiplied millions in taxes the government came up with last July, it still claims that VAT is necessary to fix our debt situation.
The plain truth is The Bahamas, due to the way we spend and the make-up of our economy, is not going to be able to tax its way out of our debt situation. But what it is doing instead, is taxing its citizens onto the unemployment line, the poverty line, the social services line and the hospital lines as the stress of record unemployment, limited job prospects and the pressure to make ends meet is becoming harder and harder for growing numbers of Bahamians to bear.