No new taxes in 2007-08 Budget, says Bahamas government
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| Published on Saturday, June 2, 2007 |
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By Clunis Devaney
NASSAU, Bahamas (BIS): The Free National Movement Government has assured the Bahamian people that there will be no new taxes, neither increases in existing taxes in the 2007-2008 Budget.
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| Bahamas Prime Minister, Hubert Ingraham |
The Budget was presented in the House of Assembly on Wednesday, with a marathon debate expected to begin on Tuesday, June 5.
Prime Minister and Minister of Finance Hubert A. Ingraham said in his communication that the 2007-2008 Budget has a planned recurrent surplus of $25 million.
“Recurrent revenue,” he stated, “is projected at $1,490 million, representing an increase of 9.9 per cent over the projected outturn for 2006/2007 and an increase of 10.6 per cent over the original estimate for this year. This projected increase arises from revenue buoyancy and continued focus on revenue collection.
“The increase in recurrent revenue arises principally from stamp tax which has shown remarkable growth in recent years due to a combination of robust property sales and increased emphasis on revenue administration.”
Ingraham said Stamp Tax, as a proportion of total revenue, is projected at 27 per cent, just behind customs duties at 41 per cent.
He noted that Real Property Tax contribution to revenue is projected to increase by 21 per cent. Other contributions to revenue, including customs duties, are projected for only modest increases.
Ingraham announced that his government is setting aside $3 million to provide relief to those on the lowest income levels as revealed in the Poverty Study conducted by the Department of Statistics and the Inter-American Development Bank.
“It is our intention,” he told House members, “to assist those persons now trapped in the lowest levels of poverty and deprivation escape from their plight, and enable them to lead more comfortable lives.”
The Prime Minister said he will shortly set out certain reductions in taxation “which we are making in 2007/08.”
According to Ingraham, the FNM Government is making an annual grant of $1 million to the Bahamas National Trust to enable the Trust to continue with “the excellent work” which they do promoting The Bahamas’ cultural heritage and promoting the nation’s natural environment.
“The broad aim of the revenue measures in this Budget is to continue harmonizing the rates of duty; to reduce the cost of certain basic food items; and to reduce general costs to the public,” he said.
Specific revenue measures include:
Customs duties on noodles, infant car seats, and baby walkers; sewing machine needles, sewing thread, bobbins for sewing machines, furniture bases and covers for sewing machines; and fertilizers, insecticides, fungicides, rodenticides are reduced to zero from between 15 per cent and 35 per cent.
Customs duty on juices exceeding 13 ounces is reduced from 50 per cent to 10 per cent to align it with duty on juices under 13 ounces.
Customs duty on doors and windows made of plastic and steel is reduced from 35 per cent to 25 per cent aligning the duty rate to that on imports of windows and doors made of wood.
Customs duty on dishwashers, dishwasher parts, parts for mowers for parks and sports grounds, and for sanitary ware (bathroom fixtures) made of plastics is reduced from as high as 45 per cent to 25 per cent, bringing duty on these items in line with other household finishing and appliances.
Customs duty on pleasure vessels of less than 150 gross tons and less than 30 feet in length is now reduced from 20 per cent duty and seven per cent stamp tax to five per cent duty and one per cent stamp tax.
Ingraham said the overall provision for Capital Expenditure is almost $225 million.
He emphasized that this is an increase of almost 13 per cent over 2006/07 and signals his government’s commitment to modernizing and expanding the nation’s infrastructure.
“In this context,” said Ingraham, “my government attaches the highest priority to developing the Lynden Pindling International Airport and the Marsh Harbour International Airport.
“These airports will be enabled to borrow the necessary funds on the capital markets and finance the funding by way of user charges. This is an internationally accepted way of proceeding.”
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