A local businessman said one way the government could address the problem of racking up billions of dollars in debt each year is for a ceiling to be placed on the amount of money it is allowed to spend each year.

Super Wash President Dionisio D’Aguilar who is also a member of the Coalition for Responsible Taxation said before rushing into implementing Value Added Tax (VAT) there should be a cap placed on government spending.

“My idea is to limit out debt to Gross Domestic Product (GDP) ratio at 65 per cent,” he said.

“The debt to GDP, you cannot go over that limit. You hear the politicians saying that you can’t limit what they spend. That might be a problem. That might be arrogant. There is always going to be a reason why they overspend. Election coming, everyone needs a raise. As part of our fiscal reform, we have to force our 38 elected officials to live within their means.”

Mr. D’Aguilar was speaking to a packed auditorium of College of The Bahamas students at the school’s “Speakers’ Corner on VAT.”

Mr. D’Aguilar was joined by the Co-Chair of the Coalition for Responsible Taxation Brian Myers, who said they are not bashing the idea of VAT, but rather asking the government to fully examine the proposed tax.

He said the fact that there are so many other taxes the government cannot seem to properly enforce; he does not see how VAT will be any different.

“We understand that with the fiscal condition of the country there is no doubt the country requires tax reform,” he said.

“Where we differ is what the right answer is for that. The concern that the coalition has and my own concern frankly, is that if we look at a number of indices there is reason for concern at the current intended implementation rate of 15 per cent. There are a lot of things that don’t work properly in this country. I have tried calling the VAT hotline and couldn’t get through.”

Also speaking at the event was former Free National Movement (FNM) and independent parliamentarian Tennyson Wells, who said he sees nothing wrong with VAT.

According to Mr. Wells, VAT was being considered from the days of Sir Lynden Pindling.

“There were discussions in the Pindling Administration who thought that VAT should be introduced and every administration since 1987 has been discussing bringing VAT into force in this country,” the former Bamboo Town MP said.

“It is a question of fear. Sometimes politics plays a serious role. Governments get afraid that if they bring VAT in, they would be voted out during the next elections.”

Mr. Wells said he believes Bahamians should just accept the new tax and move on with it as VAT will help bring the country out of billions of dollars of debt.