Call for govt to prove ‘it’s got its facts straight’ over VAT
Guardian Business Editor
Published: Oct 15, 2013
The government has been urged to move swiftly to release all of its “financial modeling” work on the impact of the value added tax (VAT) so that businesses and consumers can see if it has got its “facts straight”, the head of the Bahamas Chamber of Commerce and Employers Confederation’s (BCCEC) VAT division has argued.
Robert Myers, vice chairman of the BCCEC, said that seeing evidence of how VAT is expected to impact revenue, growth and other variables under “best and worst case scenarios” is among the “most critical” pieces of information that the government should be prepared to release as it pushes ahead with implementing the tax.
He identified such modeling work, in addition to the tariff schedule showing how tariffs on goods will be adjusted when VAT is implemented, as two additional fundamental pieces of information that the government should be releasing in conjunction with the VAT legislation and regulations.
“I think we have a right to understand what the modeling looks like. When I start a new business, I look at what’s the best and what’s the worst case scenario. Let’s stress test the model and see what happens if things go wrong.
“They’re asking businesses to go through a lot of trouble to implement this and comply and if the net result is that they slow the economy or cause stagflation, then we should be able to see that for ourselves.”
Myers added that the private sector should be doing its own analyses of the likely impact of VAT under different conditions.
The BCCEC recently formed a Tax Reform Committee which it says will seek to “engage constructively” with the government over VAT.
Chester Cooper, BCCEC chairman, said the purpose of the committee is to “elevate the discourse” over VAT, get more stakeholders engaged in the discussion over the tax, and to provide analyses of its likely impact.
With VAT due to be implemented on July 1, 2014, the government has yet to release VAT-related legislation and regulations, despite having most recently indicated that it was aiming to do so by the end of September.
On September 25, VAT consultant to the government Ishmael Lightbourne told attendees at a meeting of the Bahamas Society of Engineers that the legislation and accompanying regulations have been before the Cabinet for “a month”.
“We’re pushing as much as we can to get it out of there because we know you need to see it,” said Lightbourne at the time.
There has been no indication given that the government intends to release financial modeling work as suggested by Myers.