Roberts dismisses VAT criticisms
Guardian Senior Reporter
Published: Oct 07, 2013
Progressive Liberal Party (PLP) Chairman Bradley Roberts yesterday criticized Sir William Allen for his “harmful” and “inappropriate” comments on the government’s proposed value added tax (VAT) system.
In a statement, Roberts said that Sir William — a former Central Bank governor, former minister of finance and former consultant to the Ministry of Finance — should have been better informed on the issue.
Sir William was quoted in The Tribune on Friday saying the 2014 deadline for VAT implementation is “not doable”, adding that the economy is still “too weak” for the new tax structure.
“My concern with the VAT is that they are seeking to put in place much too short a schedule,” Sir William was quoted as saying.
“I don’t think that sufficient time has been given to putting it in place, to put into effect a VAT system by July 1, 2014, with the best of intentions. That is not doable in my view.
“It is not doable, or if it is done it will be very inefficient and it’s going to lead to considerable disappointment on [government’s part] in terms of revenue that they collect and a lot of frustration on the part of the taxpayers.”
However, Roberts said Sir William sought to create confusion and his comments were politically motivated.
Roberts said the government has answered several of the questions raised by Sir William, such as whether the Christie administration would lower current taxes when VAT is brought on stream.
“The government was very clear and said over and repeatedly through its VAT implementation team that customs duties will be reduced by 17 percent across the board, eliminating some $300 million in customs duties; the revenue replacement will be the application of a 15 percent VAT that will broaden the tax base, raise approximately $500 million in revenue and increase government’s revenue by some $200 million,” the PLP chairman said.
“The government could not be any clearer in communicating its fiscal consolidation plan and the underlying reasons to the general public.”
Roberts also hit out at critics of the system whom he accused of spreading “misinformation” and “rank negativity” through the press.
“Creating confusion, negativity and hysteria in the public domain hurts everybody because we are all in the same proverbial boat and on the same pieces of rock we call The Bahamas,” he said.
“In the current circumstances inaction by the government is not an option and hurts everybody and so would a delay in the implementation of VAT.”
Roberts added that both major political parties have agreed that VAT is a necessary measure to reform the country’s tax regime and help the government to meet its fiscal demands.
“I am confident that in the end this government will make the right decisions that are in the best interest of all Bahamians and the country’s economy will emerge stronger as a result,” he said.