Rick Lowe
The Tribune Business carried this lead story on Thursday.
The suggestion that we need more tax dollars to pay for an ever expanding government is analogous to looking the wrong way when crossing the street.
Seems to me the first step should be to see where the government can reduce spending and balance the budget.
Somehow the government approach is to take more from the citizen in taxes, not reduce its burden on the population.
Instead of finding ways to reign in spending the objective is to implement a new tax system (Value Added Tax) so revenue can be boosted.
I can see the politicians buying, sorry, counting the votes now.
It makes no sense. The Tax Structure does need to be re-aligned so to speak. But that predisposes that government is going to be growing and growing and thus the cost of it going up. I fear, that it won’t be until the cost of living is so artificially high, because of so much govt. regulation and tariffs and when NIB or Income Tax reaches to about 25 percent, that their will be real change.
I agree Larry.
The whole point for changing the tax system in my opinion is so they can continue to spend like there’s no tomorrow.
As I’ve said on numerous occasions, the political class of today will be off in the sunset collecting their pensions off the backs of tomorrows workers for their “service to the country” that saddled future generations with an unconscionable debt.
I am of the belief the tax system does have to be reformed. Not solely for the need for revenue growth, but because a reformed tax system can encourage economic expansion in the Bahamas. With a carefully implemented hybrid tax system (not solely VAT or solely corporate tax, etc) we can actually attract new industries to the Bahamas. This will create additional economic opportunities for the private sector. Tax reform should not stand in isolation and should not be separate from economic reform
– Ryan
Welcome back Ryan.
A VAT is certainly the wrong way to go in my opinion. The goods and services are taxed far too often along the purchase chain.
The Nassau Institute is presently publishing a book of a study of the Bahamian economy done by Dr. Alvin Rabushka and he settled on 17% as the level of tax we should require or something like that.
We must have built in debt to GDP levels etc as well to stop this profligate spending and borrowing by the political class.
It’s like our politicians do not learn from history.
I guess they’re too busy trying to create their own?
RIck – tax reform starts and ends in Government, what is required is forward thinking reformers in Government. I agree with you that a VAT exclusively is the wrong way to go.
Ryan:
There are no reformers in government or in the opposition.
If you are the party quickly sidelines you.
It’s far too easy compromise on things creating the mess we have today.
Our monetary policy is a mess that doesn’t help.
Hope you are coming to the Nassau Institute event on Thursday evening (March 11, 2010)?
Rick – some of us hope to change your opinion. I will try to make it.
Some thoughts on why a VAT is the wrong policy.
http://bit.ly/8YzH3j
This was sent to me & I think it applies here.These are possibly the 5 best sentences you’ll ever read:
You cannot legislate the poor into prosperity by legislating the wealthy out of prosperity.
What one person receives without working for, another person must work for without receiving.
The government cannot give to anybody anything that the government does not first take from somebody else.
When half of the people get the idea that they do not have to work because the other half is going to take care of them, and when the other half gets the idea that it does no good to work because somebody else is going to get what they work for, that my dear friend, is the beginning of the end of any nation.
You cannot multiply wealth by dividing it.
Hear Hear DP.
Actually, I would point out the losses in government revenue in the existing system, due to the readyness of Civil servants to make “exceptions” to the law on behalf of friends family and opportunists, not limited to themselves and certainly profitable to themselves and others.
No matter the systems migrated to, they will be fraught with fraud.
I am still looking for the Government credit dept,
but alas…………
Government seldom prosecutes fraud, in fact not even wanting to know about it.
Rule by fiat is their down fall, as people are not only trying to avoid legitimate taxation, but also stay under the radar of the lurking civil servant profiteer/facilitator.
No business could sustain the Damages to its property, the hands in the till, the hyperextended credit, the lack of productivity that Government tolerates, and continue to exist.
Come to think of it, we tolerate and pay for it!