Reviewing the recent budget address by Prime Minister (Perry Christie (PLP) ( Download OpeningBudgetStatement25May2016 ) (pdf)) some interesting tax reductions and tax increases are to take place starting at page 86 he proposes the following. My comments are underneath each in parentheses:
Customs Duty Exemptions and Real Property Tax Concessions.
(These taxes are obviously causing problems for some people yet they are now surveying certain properties to charge them more?)
Expand concessions for light manufacturing.
(Light manufacturing seems to be a favoured crony of most governments around the world. These so called infant industries never seem to grow up?)
Allow churches to import air conditioners duty free;
(Most churches are more profitable than businesses. Why limit this exemption to churches?)
Reduce or eliminate the duty on a number of household and grocery items, including appliances and parts, prepared turkey, ham, beef and chicken meat, macaroni, spaghetti with meat and the like, ice cream, biscuits, waffles, cakes and pastries among others;
(This is most curious. Would reducing taxes on healthy foods be better for the poor?)
Eliminate the duty on baby clothes and reduce the duty on used clothing;
(Here again, why limit it to these items?)
Eliminate the duty on costume jewellery, perfumes and certain leather goods;
(Are these taxes negatively impacting these industries while they have no impact on others?)
Reduce the duty rate on computer peripherals, routers and related items;
(Again it appears the high rate is counter productive.)
Replace all remaining rates of duty of 7 per cent with a 5 per cent rate;
Reduce or eliminate the duty on various building materials such as plywood, sheet rock, cement, roofing tiles and shingles, electrical wiring, marble and granite and other stones among others;
(Why reduce it for some industries and not others?)
Reduce the environmental levy on used tires to reflect the low value cost of such imports;
(Seems you would want to reduce taxes on newer tyres that last longer before being condemned to the dump?)
Exempt from VAT ancillary fees paid along with tuition fees; and
(So, the potential negative impact pointed out before this was implemented was correct?)
We will develop a framework to allow the Minister of Finance to take steps through the Tariff Act to protect Bahamian agricultural and manufactured products.
(Here again, these industries are continually granted more and more favours from the tax authorities while others are charged more and more.)
Increase the Customs storage charges for vehicles;
Implement a licencing regime for cargo couriers;
Institute a fee to amend cargo manifests;
Institute a fee for the Parcel List used by cargo ships;
Allow for a processing fee to be levied on the shipper if prohibited or restricted goods are found on-board their vessel;
Charge a higher processing fee for the late submission of manifests and the loading list; and
(Note all the new taxes.)
Make electronic submission of Customs entries mandatory as of July 1, 2016.
Adjust the requirement of the Tax Compliance Certificate to cover major shareholders with over 20 per cent of the shares as well as companies with similar shareholders;
(Interesting how government can choose to impose these things on others yet will not live by the same rules.)
Increase the enforcement provisions under the Excise Stamp (Tobacco Products) Control Act to allow for the compounding of penalties and for Customs officers to better monitor tobacco manufacturing;
Amend the Stamp Act to clarify the meaning of transaction values such that stamp tax can be properly assessed;
(This could have deleterious effects.)
Adjust the date for the submission of VAT payments to 21 days after the end of the month, with effect from January 1, 2017;
(This task keeps getting more and more onerous.)
Allow for the waiver of Stamp Tax and VAT on Deeds of Exchange because of errors in property description;
Amend the Stamp Tax Act to reduce the rate of tax to 2.5 per cent on marina slips, as with other conveyances;
(Why them and not other industries?)
Allow stamp tax concessions/exemptions to be granted to first-time homeowners who may have missed the opportunity due to non-submission of documents for stamping;
Provide a full amnesty on the surcharge which is now applied for late stamping of conveyances and other documents for 90 days and the application of a fixed penalty of 10% of the applicable stamp duty thereafter;
Require that non-profit entities and charities be designated as such by the Registrar General or the Attorney General before qualify for duty-free concessions;
Amend the Stamp tax Act to adjust and eliminate a number of the fees.
The way the tax regime is applied confirms yet another quote from Ludwig von Mises as certain industries are taxed more than their net profits while others are given concessions.:
"The metamorphosis of taxes into weapons of destruction is the mark of present-day public finance."
