by STAFF WRITER
January 7, 2022
NASSAU, Bahamas, Jan 7, CMC – The Bahamas government will announce a new strategy regarding real property tax during the presentation of the mid-year budget next month
“The tax system we have now is a very narrow-based system and so the tax reforms that we envision are to broaden the base and lower the overall rates for Bahamians,” Financial Secretary Simon Wilson told the weekly news conference.
“Right now we tax a few at a high level and the idea is we will broaden the base. One of the areas we are looking at very closely is property tax, in terms of how to broaden the base and lower the rate so that our yield goes up.”
Property tax represents less than 10 per cent of government revenues and real property tax arrears have been estimated at more than US$600 million.
The Financial Secretary told reporters that the Phillip Davis government will assess revenue performance under a reduced value-added tax (VAT) model, noting that it could perform better than the projected neutral forecast.
“Based on the estimates the prime minister presented in the supplementary budget, the reduction is going to be at a minimum neutral and positive. During the annual budget exercise, we’ll have four months of data and we will present that in terms of what is the increase overall in terms of the reduction,” he said.
Wilson said that with revenue performance higher than projected “we are very satisfied. If we look at our revenue performance against forecast, we are US$160 million above revenue performance.
“The Revenue Enhancement Unit is actually being formed and is working. We have engaged our revenue advisors, we are very excited by what we see in terms of the potential for revenue yield. On the expenditure side, the overhang in terms of liabilities and so forth has been reduced, it is not reduced to a bare minimum but considerably from when I came back into the office.
“So from that perspective I see green shoots in terms of the strategy,” Wilson told reporters.
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