Opposition Leader Philip Davis yesterday expressed concerns coming into the new fiscal year as he feels that the government has missed critical fiscal targets for the last two budgetary cycles and because they have failed to present realistic budget estimates.
These comments come ahead of Deputy Prime Minister and Minister of Finance Peter Turnquest prepares to give the Budget Communication this month.
Mr. Davis said that the Finance Minister and his cabinet colleagues are “bloody minded” in their desire to abandon well considered plans for the modernization of the country left in place by the Christie Administration.
This, he said, is all in an effort to mortgage the assets of the State to benefit foreigners, friends, families, and political cronies.
Mr. Davis predicts this will intensify in the upcoming fiscal year.
He said, “they have decided to transfer public buildings to a fund created by Holowesko Partners to minimize the ability of other Bahamian individuals and entities such as the National Insurance Board, churches and ordinary Bahamians from renting to the Government. At an estimated $400 million price tag, one can only imagine the windfall the Holowesko Partners stand to gain from compounded interest payments alone.”
He also expressed that the government has decided to eliminate business license fees for all banks including RBC, Scotia, CIBC, Citibank and Commonwealth Bank as a reward for their profiteering of Bahamian workers and not lending to Bahamian businesses.
Additionally, he said that the current administration ensures that business license and Value Added Tax (VAT) is calculated on the same tax base to reduce the business license fees of large food stores, pharmacies, Morton Salt and others with large zero-rated or exempt supplies.
Lastly, he said that the government’s decision to join the World Trade Organization and reduce the Common External Tariffs (CEF) to an average of 15 per cent in less than three years, will benefit large importers and in the process, foregoing more that $100 million in revenue without any articulated replacement plan.
While statistics shows a 1.6 per cent growth in the economy, Mr. Davis noted that customs revenue is down in comparison to last year at the end of the third quarter.
Overall, he said, the government’s revenue is also down against projections at the end of the third quarter because of what he calls an “ill –considered 60 per cent increase in VAT and meddling with the tax structure of the web shop gaming industry.”
Additionally, the opposition leader labelled the dismantling of the Revenue Enhancement Unit within the Ministry of Finance as another “poor politically motivated policy”.
He added that there was over $400 million in uncollected taxes and hundreds of high end properties unregistered, leaving taxes unpaid.
The PLP leader said, “As this Government is both arrogant and indifferent to human suffering, all of these institutions have been forced to do more with less and the non-Governmental Organizations which in the past have relied on Government subvention, now do so virtually alone as a result of no adjustment in their subvention to account for the 60 per cent increase in VAT imposed last year.”
For the working poor, Mr. Davis said , the outlook is bleak, as he indicated that the government refuses to increase minimum wage in the wake of raising taxes.
He added that VAT’s increase coupled with inflation significantly reduced the poor’s small income.
As a result, he said, the government has five options – to increase taxes and/ or fees, drastically cut recurrent and capital expenditure, borrow from the Central Bank, borrow internationally, or find any excuse to abandon the government’s failed policies… all of which he says are equally bad for the country.
“In light of the foregoing, we in the PLP have no confidence in the ability of this FNM government to put politics aside and bring to Parliament a realistic and practical budget, taking into account the reality of what is happening on the ground and literally in thousands of Bahamian households.”, he said
“We say again that the country would have been better off and better served had the FNM left in place many of the policies they inherited from the PLP government.”, he added.
Finance Minister Peter Turnquest is set to give his third budget communication of this term on or before Wednesday may 29th.
