05282021 BUSINESS

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FRIDAY, MAY 28, 2021

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‘Very confident’ of 80% rebound by mid-2022

By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net

T

HE Ministry of Finance’s top official yesterday predicted the Bahamian economy will regain 80 percent of its pre-COVID capacity by June 2022 with key taxes forecast to rise by a similar magnitude.

Marlon Johnson, the acting financial secretary, told Tribune Business improved tax revenue flows over the past four to five months - together with the vacation rental market’s return to 70 percent of preCOVID business levels and signs the tourism plant is

• Top Finance official optimistic on tourism, tax trend • Property taxes to rise $54m; web shops up by 78% • Ex-finance minister fears revenue forecasts ‘optimistic’

MARLON JOHNSON

GOWON BOWE

“gearing back up” - meant he was “very confident” the economy will return to four-fifths of pre-pandemic output in a year’s time.

His optimism came after a closer study of the government’s 20212022 revenue forecasts revealed it is projecting a

51.5 percent year-over-year increase in real property tax collections, together with a 77.5 per cent hike in taxes paid by the web shop gaming industry Real property tax revenues are projected to increase by more than $54m to over $158m on the strength of greater enforcement and improved administration, while web shop gaming revenues are forecast to jump by $17.9m

SEE PAGE 5

Govt urged to delay 12% VAT realty hike

By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net THE government was yesterday urged to postpone implementation of the 12 percent VAT rate on highend real estate deals for two months so as not to derail transactions “already in the pipeline”.

Andrew O’Brien, attorney and partner with the Glinton, Sweeting & O’Brien law firm, told Tribune Business that The Bahamas “doesn’t put its best foot forward” with international investors when it suddenly raises transaction costs and forces the parties involved to find extra funds.

Pointing out that The Bahamas is in fierce competition with foreign rivals to attract high-end real estate purchasers, he urged the

• Two-month pushback for deals ‘in pipeline’ • Attorney: We can ‘put our best foot forward’ • Minister argues rise ‘won’t dampen market’ government to delay applying the 12 percent VAT rate to the portion of real estate deals worth $2m and above until September 1, 2021, as opposed to bringing it in at the fiscal year’s July 1 start.

This, he argued, will give existing transactions above that price point - and for which sales agreements were signed before Wednesday’s budget communication - sufficient time to clear and complete all documents and payments necessary given that most deals permit a 90-day closing window.

Arguing that such precedent has been established by the Stamp (Surcharge Amnesty) Acts of 2016 and

Bahamas ‘can’t alter taxation on a dime’

By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net

THE Bahamas “does not have the luxury of changing its tax system on a dime”, a Cabinet minister argued yesterday amid escalating pressures for a minimum global corporate tax rate.

Kwasi Thompson, minister of state for finance, told a post-budget press conference that The Bahamas cannot afford to “make changes at a whim” and “haphazardly” adjust its taxation system without having the necessary data to determine the impact

on taxpayers, businesses and the wider economy’s competitiveness.

The Bahamas and other international financial centres (IFCs) are likely to come under increasing pressure to implement a corporate income tax if the US and European Union (EU) can reach agreement on the issue, but Mr Thompson argued that local debate on the matter was too “nonchalant” and not being guided by empirical evidence.

“Many people are speaking about changing the tax

SEE PAGE 8

$10bn national debt ‘elephant in the room’

By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net A CABINET minister yesterday admitted that The Bahamas’ near-$10bn national debt is “the elephant in the room” that can potentially wreck this nation’s post-COVID economic recovery.

Kwasi Thompson, minister of state for finance, told a post-budget press conference that the government will unveil its strategy for managing its debt once the Public Debt Management Act comes into effect when

the 2021-2022 fiscal year starts on July 1.

He argued that the budget “strikes a necessary balance” between economic growth and fiscal austerity, even though the national debt is forecast to continue rising to hit $10.386bn by end-June 2022, with further increases taking it to $10.755bn by June 2024 as the government continues to run annual fiscal deficits.

“The elephant in the room is the debt level,” Mr Thompson conceded. “Commentators have pointed out

SEE PAGE 8

2017, which allowed a similar 90-day grace period, Mr O’Brien told this newspaper: “We would like to urge the government to postpone the effective date of this provision to allow existing transactions to clear through the pipeline.

“We suggest a start date of September 1, 2021, which would give approximately 90 days notice from the passage of the Act [budget announcement].

Providing such notice is simply a better way to do business, as it gives time for the market participants to plan and react, and it increases predictability in a transaction, which promotes the

ease of doing business that The Bahamas is seeking to improve.”

However, the reforms to the VAT Act, which will introduce the 12 percent rate on the portion of a real estate transaction worth more than $2m, are due to take effect from July 1, 2021, to coincide with the start of the new fiscal year.

And, given that the government expects to raise just an additional $4m from the increase, many observers will likely argue that the wealthy participants in such transactions will not be

SEE PAGE 4

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Taxpayer job ‘band aid’ no longer viable

By NEIL HARTNELL Tribune Business Editor nhartnell@tribunemedia.net

A CABINET minister yesterday admitted successive administrations have used taxpayer funds as “band aids” to cover up their failure to grow the Bahamian economy and create sufficient jobs.

Senator Kwasi Thompson, minister of state for finance, told a post-budget press conference that The Bahamas had “for too long” relied upon the government to be the main employment generator through expanding the size of a now-bloated civil service.

Using language more typically employed by corporate Bahamas than a politician, he argued that the country can no longer afford to place the government at the centre of its economic model and must do everything it can to position the private sector as the key growth and employment driver.

Justifying the budget’s focus on growth as opposed to fiscal austerity, Mr Thompson also admitted that The Bahamas “cannot tax its way out” of its near$10bn national debt - more than $3bn of which will have been added in the three years to end-June 2022 as a result of Hurricane Dorian and COVID-19 - and instead must grow the economy to restore fiscal health.

He admitted that achieving accelerated gross domestic product (GDP) expansion will require The Bahamas to shake off the “anemic” growth rates it has endured since the 20082009 global recession, and this will require the country to “shift the fundamentals of our economy in a major way”.

Confirming what many in the private sector have known for years, Mr Thompson said: “For too long we have relied on

Bahamas endures ‘lost decade’

KWASI THOMPSON the government to be the primary source of employment, using public funds as a bandaid for longstanding, acute structural deterioration..... For too long, the government has placed itself at the centre of national economic life.”

Affirming that the Budget, and its so-called Accelerate Bahamas Recovery Plan, are designed to place the private sector at the forefront of rescuing the Bahamian economy from the twin ravages of Hurricane Dorian and COVID-19, the senator also acknowledged that a full rebound was “still in the distance”.

“Even as we can see an end to the global pandemic, thanks in large part to the roll-out of vaccines around the world, we are still on the road to full recovery,” Mr Thompson said. “Our immediate response was successful at staving off and buffering the very worst effects of the pandemic while continuing to support post-Dorian reconstruction efforts in Abaco and Grand Bahama...

“Today, the end of the pandemic is in view, but the full economic recovery to pre-crisis levels is still in the distance, not to mention our true growth ambitions for the medium and long-term. Today, the

SEE PAGE 7

PAGE 2, Friday, May 28, 2021

THE TRIBUNE

ADVANCING YOUR STAFF FROM WITHIN P

ROMOTING from within is a time-tested practice. It builds staff morale and assures your staff there are opportunities for them within the company. When the strategy is to retain and promote current employees, the focus must be placed on developing succession models where talent can be advanced internally.

This column today shares six tips for employers who seek to do this: 1. Have job descriptions for every role in the company Detailed job descriptions must clearly outline the daily

In the final of a three-part series that was written before Wednesday’s budget, Hubert Edwards charts the way forward for The Bahamas in the pandemic’s aftermath.

THERE are some concerns as we move into the Budget exercise. In the middle of the pandemic, significant effort was expended, especially through the work of the Economic Recovery Committee. There were a number of recommendations offered. The important point here is that the upcoming Budget will need to demonstrate greater urgency, and a clear strategic path, for the implementation of these recommendations. This is important as it plays into the government’s stated desire of creating a generational shifts in the economy.

An analysis of the government’s nine-month

tasks, qualifications and competencies required for assuming a role. These are essential for every position in the firm. Employees need to be able to research what their next level might entail, and what they need to do in preparation for an expanded role.

2. Publicise the promotion procedure Do not allow a position to become available when no one in the company knows about it. Use all the communication tools you have available to your organisation. Share all the information, including the process for applying; the interviewing process; and

the screening and selection process. Be totally transparent about these matters on the company’s website, internal webpage, memo board and anything else you use to communicate with your team. Let them know when and how to apply.

3. Know who is in the pipeline Keep a good record of who you have in your company. Employee career tracking software, in the form of learning management systems, helps you identify and track your high flyers, emerging leaders and good potential employees.

There are some employees you may need to give

COVID RESPONSE AFFECTS ALL OUR TOMORROWS

BY HUBERT EDWARDS

“fiscal snapshot” for 20202021 shows that every tax category’s performance is either at or below prior years. The major sources of taxes, VAT and trade, are both showing reductions as expected. The main taxes on goods and services, which generate over 70 percent of total revenue, are down by over $400m. VAT, the juggernaut of all taxes, is off by 36 percent with total revenue equal to about 70 percent of full-year budget forecasts. This weakening

demonstrates some of the challenges ahead. Overall, up to the end of the 20202021 third quarter, revenue is down by $527m compared to pre-COVID with expenditure up by over $100m.

With the national debt at or near $10bn, and further borrowing required, turning the economy and fiscal performance around will not be easy. The fiscal fundamentals are not in a positive place. As we look across the region and world, the economic climate is not conducive to growth. The range of options is limited and difficult. I believe that the current debt position will make the temptation to raise taxes very high.

However, I would not readily conclude that there will be tax increases, having regard for all the issues that are currently at play.

Regardless, we must not lose sight of the fact that with record levels of debt,

an extra nudge to when positions become available.

4.

Set criteria for promotions The assistant manager should know exactly what he or she needs to do while in their current role, so that when the managerial post becomes available they are ready. Every employee should have their personal developmental plans, which outline the steps they need to take to assume the next level in their career.

5. Interview and evaluate candidates Internal candidates should be the first to vie for available positions. It is understood that there

are times when no suitable candidate can be sourced internally, but every effort to have an employee apply for a “next level” role should be given to them.

6. Communicate the decision to all candidates who applied Win, lose or draw, everyone applying should receive an e-mail or meeting informing them of the decision regarding the position they would have applied for. It is the courteous thing to do.

• NB: Ian R Ferguson is a talent management and organisational development consultant, having completed graduate studies with regional and international universities.

a narrow tax space, perennial low growth and now-depressed revenue flows, new and additional taxation cannot be taken off the table.

The budget has another important problem to solve. I am calling this the “debt trap”, which can only be fixed by growth without significantly hurting the economy and country.

Without growth, it is difficult to pay down debt and stop borrowing.

With growth, debt becomes less significant relative to GDP. With growth, the tax base broadens. With growth, there is wider employment. I believe there is no other recipe for advancing any economy other than growth, and this holds true for The Bahamas. The new Budget must reach for growth no matter how crazy this may seem, while the debt has to be tackled and there must be a focus on maximising revenue. This will be akin to a delicate walk on a knife’s edge.

If I were to propose what to expect in the budget, my first reaction would be very circumspect and not propose anything in absolute terms. With that caveat in mind, these are the points I lay out:

• Increased taxes. Revenue is under pressure, and so there will be a desire to increase taxes. The current environment, with depressed economic performance, suggests otherwise.

• A clear programme of debt management with attendant impact on areas such as capital spending.

• Increased support for the social sector to address increased unemployment and the displacement of workers. In assessing the need for this, it is important to be reminded that the trigger for redundancies has been held in abeyance, a move that in my opinion makes great sense. The benefit expected from a turnaround of the economy will not be, in my view, sufficient to make the situation a zero sum game, and consequently, even with improvements there will be some unemployment fall out.

• Continued support for the private sector, especially micros, small and medium-sized enterprises (MSMEs), through the auspices of the Small Business Development Centre (SBDC). With a potential further increase in unemployment, this becomes an important mechanism

IAN FERGUSON BY

He has served organsations, both locally and globally, providing relevant solutions to their business growth and development issues. He may be contacted at tcconsultants@coralwave.com. though which fiscal policy can support the economy.

• Support for stateowned enterprises, likely not at the level needed, but given their current challenges such funding must be contemplated.

• Continued curtailment of capital spending when considered against longerterm historical levels. There is, though, the possibility of an uptick compared to recent cycles to facilitate new capital projects either already announced, foreshadowed or “brand new”.

• Increased debt and interest payments, being a natural outturn from the current position and future borrowing needs.

• There could be programmes designed to boost employment either directly or through the private sector, or more likely a combination of both.

This will have an impact on expenditure but further strengthen social support efforts.

Any forward-looking discussion or predictions around the Budget that fail to take into account the upcoming general election would be naive. The budget has to be seen in the context of the elections. One

SEE PAGE 4

THE TRIBUNE

PRIVATE SECTOR FEARS TAX RISES ‘INEVITABLE’

By YOURI KEMP Tribune Business Reporter ykemp@tribunemedia.net

THE Chamber of Commerce’s chairman yesterday voiced fears that new and/ or increased taxation is “inevitable” given the government’s still-elevated deficit spending levels.

Khrystle Rutherford-Ferguson, pictured, responding to the 2021-2022 budget, told Tribune Business in a written statement that the increased borrowing required to cover a projected $951.8m deficit is of great concern for the private sector.

And, with the

government’s recurrent (fixed cost) spending projected to rise by $270m year-over-year compared to 2020-2021’s forecast $2.556bn outturn, Mrs Rutherford-Ferguson said she was keen to see the results of the spending review being conducted with the Inter-American Development Bank (IDB) “We continue to see additional spending on supporting small businesses through the Small Business Development Centre (SBDC). However, the increase in spending to fund the initiatives and to continue COVID-19 related

CONSTRUCTION NEEDS MORE THAN TAX CUTS

By YOURI KEMP Tribune Business Reporter ykemp@tribunemedia.net

THE Bahamas Society of Engineers (BSE) president yesterday said stimulating construction activity requires more than tax cuts on building materials that typically account for just half of project costs.

Quentin Knowles told Tribune Business that while he welcomes the decrease in duties unveiled in Wednesday’s “materials only represent about 40 to 50 percent of the total value of projects when you break it all down”.

The prime minister, in his budget communication, said the government will “reduce duty on a number of building supplies to 20 percent and 25 percent, respectively, to encourage construction activity. Most notably, this includes the reduction in duty on electrical wire to 20 percent, and continues the reduction duties on construction related items that we began last year”.

Mr Knowles, though, argued that this will have “minimal effect” on construction activity.

He argued that a greater impact would be made by improving access to cheaper capital. “I think a more effective approach would be to find a way of reducing the cost of loans, interest on mortgages and what have you,” he added.

Describing current commercial banking practices as a “sacred cow” that few policymakers seem to want to touch, Mr Knowles said: “Politicians and those don’t want to touch it, sometimes they just seem to spin around the issue.

“We have talked about this for ages. For instance, in Abaco and the rebuilding there, the construction industry had some suggestions, especially during the initial phases of the rebuild, for places where construction workers can find housing cheaply or relatively inexpensively. It is horrendously expensive

to operate in Abaco, for instance.

“There are certain critical things I think that the government is uniquely positioned to provide, and for some reason when people from the construction industry - whether they are engineers, contractors, architects - when they make suggestions it falls on deaf ears,” he added.

“So the reduction in duties for construction materials is positive and it will definitely help.

Whether it will achieve what the government intends is a different matter.

It always comes down to financing. The requirements for qualification also, and the banks have such stringent requirements for people who are going to get loans.

“To deal with banks nowadays, due to the KYC (Know Your Customer) requirements and all of the paperwork, to even deal with a bank from even opening a bank account is such a laborious and painful process where you may even need a lawyer one day just to open up a bank account,” Mr Knowles continued.

“Those kinds of things really put resistance into the redevelopment efforts.

It is government’s role, in my perspective, to remove those impediments and make it smooth sailing. I think they will be more effective that way rather than these token efforts, which may help a little, but there are more effective solutions I think.”

support is leading to an increase in borrowing,” she said.

“The business community is concerned that it is inevitable that this level of spending will lead to an increase in taxation, which will affect the private sector either directly or indirectly.

For this reason, there is great interest in seeing the results of and implementation of recommendations coming out of the public expenditure review being conducted by the Government and the IDB.” The government sought to focus the 2021-2022 budget on enabling The

Bahamas to “grow” its way out of the economic and fiscal crisis sparked by COVID-19 and Hurricane Dorian, introducing just several targeted tax measures aimed at the wealthy and those thought to have an ability to pay, which will be used to pay for the tax breaks and incentives offered.

“Our initial impression of the budget communication is that it contains some items which could have a positive impact on the business community,” Mrs Rutherford-Ferguson said.

“However, these items require further details.

Ex-finance minister: ‘Devil is in details’

By YOURI KEMP Tribune Business Reporter ykemp@tribunemedia.net

A FORMER Cabinet minister backed the government’s focus on economic growth in the 2021-2022 budget, but warned that the “devil is in the details”.

Zhivargo Laing, pictured, minister of state for finance during the 2007-2012 Ingraham administration, told Tribune Business that the prime minister’s budget communication needs more analysis as there are multiple details not typically addressed in the headline presentation.

“I think the budget makes provisions for the obligations the government has in terms of salaries and those sorts of things, which is always for me the starting point of a budget - whether the government makes provisions on what it is required to fund, and that is salaries, interest payments and its ordinary programmes,” he said.

“I think that in some of the programmes that the government suggested it wants to carry out they represent some positive aims in terms of trying to encourage economic recovery and growth as a stated objective of the budget.”

Describing the 2021-2022 budget as “appropriate” considering that The Bahamas is grappling with the economic fallout from the COVID-19 pandemic, Mr Laing added: “I fully endorse the aim and objective of focusing and concentrating on economic

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Notice!

The 41st Annual General Meeting of the Public Workers’ Co-operative Credit Union Limited will be held at the Church of God Auditorium, Joe Farrington Road, on Friday, May 28th, 2021, commencing at 4:00 p.m., for the following purposes: To receive and ratify the 2020 Board of Directors’ Report To receive and ratify the 2020 Audited Accounts To receive and ratify the 2021 Budget To Elect three (3) members to the Board of Directors To Elect three (3) members to the Supervisory Committee To Elect two (2) members to the Credit Committee To take action on all matters that may come before the meeting.

NO NOMINATIONS WILL BE ALLOWED FROM THE FLOOR! The AGM will be livestreamed on Facebook; via our website: pwccu.com.

recovery and growth, and trying to curtail the spread of the COVID-19 virus, which in itself represents a threat to economic recovery and growth.

“I do think some of the programmes the government laid out to try to

Friday, May 28, 2021, PAGE 3

“Over the course of the national budget debate, the BCCEC will review the draft estimates and listen to the ministers as they present their plans. Such plans will give the private sector insight into the policies that will be used to implement the items contained in the budget.”

Mrs Rutherford-Ferguson laid out five key areas that need more details. They first was the government’s intent to provide duty-free concessions for start-ups and small businesses, which could boost the entrepreneurial sector.

She also called for details on the public-private sector infrastructure fund, aimed

at pooling private capital to finance major infrastructure projects, as well as the $40m VAT credit employment incentive initiative; enhanced government digital transformation; and the number of Bahamian companies and workers that will be employed on the $100m public healthcare expansion projects.

accelerate the economic recovery represent positive thinking in the way of trying to encourage growth, but the devil is in the details.

Mr Laing said external factors could impact the success of budget initiatives, such as the $40m VAT credit initiative that is aiming to finance the hiring of up to 2,500 Bahamians by providing payroll support to companies to hire up to ten non-executive workers.

“Notwithstanding the desire of the government to encourage employment by giving tax breaks, the truth is businesses will only employ people if they need people because there is more revenue to be had from hiring additional people” he added. “If there’s more revenue to get from hiring more people,

the business will hire more people anyways.

“I’m saying the government’s idea to try to stimulate economic growth, through incentivising businesses, is a good idea. I just mean that you have to try to make sure that the programmes you’re using are capable of doing that, and it’s just that one of those programmes may have some challenges that way.”

Mr Laing said talk of an “election budget” was wrong, adding that every administration has set at least one budget prior to an election. He said the 2021-2022 version is no different as the level of spending by the Minnis administration is little different to its predecessors due to the COVID-19 pandemic.

PAGE 4, Friday, May 28, 2021

COVID RESPONSE AFFECTS ALL OUR TOMORROWS FROM PAGE TWO

must assume that the incumbent administration will not do anything that is likely to hurt their chances of being re-elected, and will do whatever is possible to enhance their chances. It is reasonable to assume that a number of lagging projects could be brought to the fore together with new initiatives designed to secure

early gains and capitalise on the slow but progressive opening up of the global economy.

Conclusion The economic state of affairs in The Bahamas is very challenging. We are faced with a moment of supreme importance for the country’s future. It is my view that this moment not only demands the taking of some hard decisions but also screams out for collaborative approaches to finding solutions. The extent to which the fortunes of The Bahamas will change is in the hands of its citizens. This calls

THE TRIBUNE for leadership and active engagement to inspire the effort going forward. We have big challenges but also glorious opportunities to build for a better and more resilient future. The extent to which each individual aligns himself or herself with that kind of thinking is fundamental to what will be achieved.

The positives seen in the latest fiscal snapshot, limited though they may be, have to be built on. The big message is that things are not static and there will be positive changes in the world eventually. The question we must ask, and

answer, is how well positioned is The Bahamas to capitalise on that. The current challenges should be seen as a gestation period, meaning a necessary time of strategising, changing, fixing and building for the future delivery of a state pregnant with potential, possibilities and improved capacity. Failing to do what is necessary will render the inevitable pain and suffering wasted.

The circumstances are challenging, but it should not be seen as all doom and gloom. There are some clear paths that must be taken to make them better, even

though the pay-offs are for the longer haul. None will be easy, and all come with complications and potential pain. The solutions that I can envision will require adjustments at all levels, and modifications to what normal looks like up to now.

I believe that the upcoming Budget cycle represents a pivotal opportunity to make the necessary shifts, articulate the required strategies and policies, and to set the tone needed for the future.

Given all the issues considered herein, it is fundamental that strategies are clothed with urgency while being well thought-out at

every step. I am fully convinced that The Bahamas has the ability and capacity to solve its problems - every single one. As a country and as a government, it cannot be done alone. Support will be needed, external investors are required, local investors must be facilitated and growth must be directed at serving the international market in a bigger way. It is time to flex the national collective muscle in favour of whatever it is that we desire the future of the country to be. That must be the focus. This is a flexing of the collective muscle for the greater good.

Payments provider inks Govt urged to delay 12% VAT realty hike deal with govt’s DigiPay FROM PAGE ONE

By YOURI KEMP Tribune Business Reporter ykemp@tribunemedia.net AN electronic payments provider yesterday said it is helping the government to realise its digital transformation agenda by signing an agreement to work with the latter’s DigiPay solution.

Barry Malcolm, pictured, Sun Cash’s chief executive, told Tribune Business the deal will enable the company to facilitate payments by its clients for government services via the e-payment platform.

Sun Cash, in a statement, said: “Now you will be able to conveniently pay at all SunCash stores nationwide, the SunCash Mobile app with over 40,000-plus users online and, coming soon, the 100-plus Quickpay kiosks countrywide.

“The time is now for Bahamians to take

advantage of the government’s DigiPay platform.

We are excited to have partnered with the Ministry of Finance to facilitate payments to all government agencies connected to the DigiPay Platform that is expanding rapidly over the next few months.”

Mr Malcolm said he expects Sun Cash’s agreement with the government to spur more private sector growth and allow Bahamian companies to have the in its digital payment options.

He said: “We already have a platform to service businesses, so this will enhance

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and make more valuable for them the interconnection with Sun Cash.”

Sun Cash is “filling the blanks” left by the commercial banks that are exiting the Family Islands.

Mr Malcolm said: “Our focus has been the entire country, including the Family Islands, from Mayaguana all the way up to Grand Cay. So this really helps to drive and expand the services that will be available to citizens all over this country to access and pay for government services.”

He added that, currently, Sun Cash is able to provide e-commerce services for Bahamian businesses and companies do not need to work with a traditional commercial bank in order to accept payments online.

“We can provide those services right now,” he said.

deterred by such a relatively modest increase especially since buyer and seller are likely to split it 50/50 meaning they each pay the equivalent of just an extra 1 percent of the purchase price.

However, Mr O’Brien argued: “We don’t put our best foot forward when we make changes like this that catch people by surprise, and so to the extent we can resolve such surprises we improve our own image and the way we do business.”

While parties to real estate transactions typically insert provisions into sales agreements to guard against situations such as unexpected tax hikes, and detail whether both or just one side assumes the associated risk, he added that few actually set money aside “ahead of time because it is not something they expect”.

“Any surprises in a commercial environment just

create uncertainty,” Mr O’Brien warned. “It detracts from our attractiveness as a place to do business, and in going to buy property we are competing against the Caribbean region.”

However, Kwasi Thompson, minister of state for finance, yesterday voiced optimism that the two percentage point VAT rate hike “will not dampen the market” for high-end Bahamas properties as he reiterated that the budget’s focused tax enhancement measures were specifically targeted at individuals and businesses that have the ability to pay more.

“The whole purpose was not to focus on the average every day Bahamian, but to provide some equity to how tax.. is done,” he added.

“It’s really focused on persons who can afford to pay more, and those persons buying high-end properties in excess of $2m.

“The government believes they can pay an additional amount. Moving it from ten percent to 12 percent, we don’t think it’s going to dampen the the market any. We think persons in that price range, this will not stop them at all from continuing to purchase property.”

Mr Thompson referred to Christine WallaceWhitfield, the Bahamas Real Estate Association’s (BREA) president, for backing the tax hike provided that there were significant ease of doing business improvements to facilitate the faster closing of property deals - something the minister says he

“completely agrees with”.

He added that the government had also targeted the vacation rental market in the belief that its consumers can “afford to pay a bit more”, moving to clarify in the VAT Act that the 12 percent levy is to be imposed on the full rental rate as well as commissions.

“We have to have a balancing act with this,” Mr Thompson said. “We’re in the middle of a world economic crisis, and have a situation with a downturn that we’ve never seen before in The Bahamas, but we have to pay out more because people are in need because of the crisis.

“We have to balance the fact revenues are down, and we have an economic downturn, but we don’t want to increase taxes on people who cannot afford it. How do we strike a balance with people that can afford to pay it? We believe we have struck a balance in this budget. We believe the government has struck a balance between significant concessions and those that can afford it to pay a bit more.”

Realtors, though, were unconvinced. Mike Lightbourn, Coldwell Banker Lightbourn Realty’s president, told Tribune Business of the 12 percent VAT hike: “That could kill sales. The problem with these things is that they pop up at awkward times. We don’t want to do anything that slows down the momentum, and that will.

“If you have a big sale of between $10m to $15m, that could kill it. It takes so long to get sales agreements completed and transactions approved. I’m sure it will kill some sales. We need the revenues. I’m hoping it has a short-term dampening effect on big sales. On big transactions it could do some damage. It could be a deal breaker.

“The ease of doing business is the biggest issue with real estate. That’s our greatest problem. It takes forever to close a transaction. To me, that’s the key.”

NOTICE

NOTICE is hereby given that HENRY AUGUSTINE, of Thundra Court, New Providence, The Bahamas is applying to the Minister responsible for Nationality and Citizenship, for Registration Naturalization as a citizen of The Bahamas, and that any person who knows any reason why registration/naturalization should not be granted, should send a written and signed statement of the facts within twenty-eight days from the 28th day of May 2021 to the Minister responsible for nationality and Citizenship, P.O. Box N-7147, Nassau, New Providence, The Bahamas.

FINAL LEGAL NOTICE INTERNATIONAL BUSINESS COMPANIES ACT, 2000

SAFRA QUANTITATIVE GLOBAL FUND LTD. Voluntary Liquidation

NOTICE IS HEREBY GIVEN in accordance with section 138 (8) of the International Business Companies Act, 2000, the dissolution of Safra Quantitative Global Fund Ltd. (the “Company”) has completed, a Certificate of dissolution has been issued and the Company has therefore been struck off the Register. The date of completion of the dissolution was 12th April 2021.

Israel Borba Lyford Financial Centre, Building 2, Western Road P.O. Box CB-10988 Lyford Cay New Providence, The Bahamas

THE TRIBUNE

Friday, May 28, 2021, PAGE 5

‘Very confident’ of 80% rebound by mid-2022 FROM PAGE ONE to $41m largely on the basis of the government finally implementing the long-awaited tax on patron winnings.

Zhivargo Laing, minister of state for finance during the 2007-2021 Ingraham administration, was yesterday among those suggesting that the 20212022 budget’s revenue projections were “optimistic” given the extent of the economic and fiscal crisis produced by the twin blows of Hurricane Dorian and COVID-19.

“Whether the government can meet its expenditure depends on two things,” he said. “It depends on the revenue it collects, and the government is projecting an increase in the level of revenue collection, but I have my own concerns on whether those forecasts are a little more optimistic than they need to be.

“But it’s all future, so I don’t know and no one else knows. It is what the government says, and the government might have more insights as to why it has a particular revenue projection than I would have. If the revenue doesn’t come in the way the government expects then it does have the ability to withhold on some expenditure it may have planned to do. So there is some control there.”

Gowon Bowe, Fidelity Bank (Bahamas) chief executive, told Tribune Business he felt it would be “a challenge” for the government to hit its $2.244bn revenue target for 20212022 - a near $600m on the current fiscal year - by achieving an almost three percentage point increase in revenues as a percentage of gross domestic product (GDP).

He also questioned the projections showing GDP in current prices (which includes inflation) increasing by more than $1.5bn, from $10.806bn in the current fiscal year to $12.326bn in 2021-2022, despite the economic devastation

inflicted by COVID-19.

“There are no projections anywhere as aggressive as that,” Mr Bowe said, as the increase keeps the deficit equal to 7.7 percent of GDP. When challenged on whether the government’s revenue projections were too optimistic, and that any underperformance could result in it overshooting its $951.8m deficit target and incurring even more debt that the country can illafford, Mr Johnson replied that the Minnis administration had “carefully looked at the numbers” before setting out its forecasts.

He added that, even if revenues missed projections, the government had established this fiscal year that it can adjust its financial plans to conditions and still meet its deficit target.

For 2020-2021, the Ministry of Finance slashed its capital budget in response to the need to expand social welfare assistance beyond initial projections as a result of the COVID-19 pandemic.

Voicing optimism that the Bahamian economy will have “caught up to 70-80 percent” of its pre-COVID capacity in time for the start of the 2022-2023 fiscal year, Mr Johnson said: “Barring the unforeseen, and assuming we don’t have any natural disasters that derail us from our path, based on what we are seeing - and provided people get vaccinated at a reasonable clip - I feel very confident we will meet that mark”.

He added that the government’s revenue flows, at least compared to 2020, had been “very healthy” for the four to five months leading into the current fiscal year’s fourth quarter, while tourist arrivals based on health travel visa data “continue to tick upwards”.

“It portends that the tourism plant is gearing back up,” Mr Johnson said.

“It’s still nowhere near to full capacity, but is trending in the right direction.

From the Airbnb numbers that we get, we’ve seen it’s at 70 percent of what it was in March 2019 pre-COVID. It is steadily increasing.

PUBLIC NOTICE

“That is just one indicator, but there’s signs the traffic is picking back up and the domestic economy is picking back up.

Providing we continue vaccinations at pace, and barring no unforeseen natural disasters, we feel very confident the economy will get to that point.”

The government is forecasting significant real property tax increases across all categories. The crackdown on deadbeat commercial property owners, by forcing their tenants to pay their rent to the Department of Inland Revenue until the debt is settled, is predicted to raise revenues in this class from $35.492m in 2020-2021 to $53.232m in the upcoming fiscal year.

The work of US-based Tyler Technologies, in adding 14,000 properties worth a collective $9bn to the tax roll, and the requirement for homeowners to inform the Department of Inland Revenue when they shift their property to a rental, is also forecast to drive real property tax revenues in the owner-occupied and residential categories.

Owner-occupied real property tax is forecast to more than double, from $20.444m in 2020-2021 to $41.944m in the new fiscal year, while residential real property tax will jump from $15.788m to $27.893.

Much of that will be due to the extra $14m said to have been gleaned by Tyler Technologies’ work, as well as additional compliance

measures foreshadowed by Mr Johnson although he gave no details.

Challenged on why the government was not using existing law, which permits it to seize and auction-off properties upon which substantial real property tax is owed, the acting financial secretary said such measures were equivalent to “the last chance saloon”.

Indicating that the government preferred not to go to such extremes, Mr Johnson said the present Real Property Tax Act allows the government “to garnish the rent” if taxes are owing and the amendments to the Business Licence Act introduced with the Budget merely clarify the framework under which a tenant in such properties must pay their rent to the Department of Inland Revenue.

Tenants will not have their business licences renewed if they fail to comply with this requirement and, when it was

To advertise in The Tribune, contact 502-2394

PUBLIC NOTICE

INTENT TO CHANGE NAME BY DEED POLL The Public is hereby advised that I, MERIAM GEDEON CHARLES of Carmichael Road, Miller Heights, P.O Box CR - 56890 New Providence, Bahamas intend to change my name to MERIAM GEDEON. If there are any objections to this change of name by Deed Poll, you may write such objections to the Chief Passport Officer, P.O.Box N-742, Nassau, Bahamas no later than thirty (30) days after the date of publication of this notice.

PUBLIC NOTICE

INTENT TO CHANGE NAME BY DEED POLL The Public is hereby advised that I, DEORA LANOVIA VERNITA FERGUSON of the Eastern District and ROBERT ANTHONY GAYLE of Faith Avenue South, New Providence, The Bahamas. Parents of JANAE LEAH GENEVA FERGUSON A minor intend to change my child’s name to JANAE LEAH GAYLE If there are any objections to this change of name by Deed Poll, you may write such objections to the Deputy Chief Passport Officer, P.O. Box N-742, Nassau, Bahamas no later than thirty (30) days after the date of publication of this notice.

NOTICE

NOTICE is hereby given that PETULA ANN MARIE EDWARDS, of #9 Business Lane, Carroll’s Manor, SP-60708, New Providence, The Bahamas is applying to the Minister responsible for Nationality and Citizenship, for Registration Naturalization as a citizen of The Bahamas, and that any person who knows any reason why registration/naturalization should not be granted, should send a written and signed statement of the facts within twenty-eight days from the 28th day of May 2021 to the Minister responsible for nationality and Citizenship, P.O. Box N-7147, Nassau, New Providence, The Bahamas.

influences that particular bump up. Our anticipation is that the ongoing legal matter will be resolved soon, and at the beginning of the fiscal year or shortly thereafter we will be able to rely on that revenue.

“We’re really in the hands of lawyers at the Attorney General’s Office, but are advised that the matter is expected to be resolved fairly quickly and they are actively pursuing it. That’s the basis of our projections.”

Tribune Business understands that the litigation in question may have been initiated by a patron or group of patrons opposed to the tax, rather than the web shop operators themselves as the Ministry of Finance previously indicated.

The new tax will see a five percent levy paid by patrons on winnings up to $1,000, and 7.5 percent on anything greater than $1,000.

Resort & Marina is seeking to fill the following vacancy:

CONSTRUCTION SUPERVISOR Principle Role: • Responsible for the day-to-day activities of the Construction team and Sub-Contractors as they work on maintenance of the marina and buildings around the property.

• Monitor performance of staff and provide hands-on training and assistance to ensure projects meet proposed deadlines.

• Develop budgets for special projects and the overall department while monitoring budgets for cost efficiency.

• Prepare weekly reports and project plans for presentation to senior management.

Suitable Requirements: • Associates or Bachelors in Marine Science.

• Minimum 15 years of experience in marina construction.

• Minimum 20 years hands-on experience in carpentry, roofing and other facets of construction.

• Extensive experience with heavy equipment and hydraulic crane operation.

Email your information to careers@chubcay.com

MARKET REPORT www.bisxbahamas.com

THURSDAY, 27 MAY 2021

INTENT TO CHANGE NAME BY DEED POLL The Public is hereby advised that I, EDWARD JEROME MOSS of #17 Bartlette Hill, Eight Mile Road, Freeport, Bahamas intend to change my name to ABERASH DESTA EL. If there are any objections to this change of name by Deed Poll, you may write such objections to the Chief Passport Officer, P.O.Box N-742, Nassau, Bahamas no later than thirty (30) days after the date of publication of this notice.

suggested by this newspaper that such a move was likely to be challenged in the courts, he replied: “We feel confident the Attorney General’s Office has taken that into consideration.”

Mr Johnson urged delinquent commercial property owners to instead step forward and work out payment plans with the Department of Inland Revenue to avoid the sanctions that will be forthcoming under the Act. As for the hike in web shop gaming houses, he added that the Attorney General’s Office had been advised that litigation currently blocking implementation of the patron winning tax - which is projected to generate between $10m-$15m in extra revenue annually - will be resolved shortly.

“That really is the full year effect of the patron winning tax,” Mr Johnson said of the year-over-year revenue rise from $23.1m to $41m. “That’s what

BISX ALL SHARE INDEX:

CLOSE

CHANGE

1949.59

0.02

%CHANGE

YTD

YTD%

0.00 -142.87

-6.83

(242) 323-2330 (242) 323-2320

BISX LISTED & TRADED SECURITIES 52WK HI 5.20 33.05 1.50 2.90 1.78 6.00 6.96 3.60 6.00 4.03 6.16 12.00 2.75 7.50 10.71 9.01 14.60 4.25 8.97 16.00

52WK LOW 3.13 22.65 1.46 1.62 1.44 5.00 6.00 2.70 4.25 2.75 5.00 9.75 2.10 4.90 9.50 8.00 13.00 3.42 8.15 15.20

PREFERENCE SHARES 1.00

1.00

1000.00 1000.00 1000.00 1000.00

1000.00 1000.00 1000.00 1000.00

1.00 10.00 1.00

1.00 10.00 0.90

SECURITY AML Foods Limited APD Limited Benchmark Bahamas First Holdings Limited Bank of Bahamas Bahamas Property Fund Bahamas Waste Cable Bahamas Commonwealth Brewery Commonwealth Bank Colina Holdings CIBC FirstCaribbean Bank Consolidated Water BDRs Doctor's Hospital Emera Incorporated Famguard Fidelity Bank Bahamas Limited Focol Finco J. S. Johnson

SYMBOL AML APD BBL BFH BOB BPF BWL CAB CBB CBL CHL CIB CWCB DHS EMAB FAM FBB FCL FIN JSJ

LAST CLOSE 5.20 32.12 1.50 2.61 1.44 6.00 6.96 3.53 4.27 2.90 5.94 9.75 2.49 7.00 11.40 9.01 14.00 3.99 8.19 15.50

CLOSE 5.20 32.12 1.50 2.61 1.44 6.00 6.96 3.53 4.27 2.90 5.94 9.75 2.50 7.00 11.42 9.01 14.00 3.99 8.19 15.50

1.00 1000.00 1000.00 1000.00 1000.00 1.00 10.00 1.00

1.00 1000.00 1000.00 1000.00 1000.00 1.00 10.00 1.00

SYMBOL FBB22 BFHB

LAST SALE 100.00 100.00

CLOSE 100.00 100.00

CHANGE 0.00 0.00

BAH29 BG0107 BG0207 BG0130 BG0230 BG0307 BG0330 BG0407 BSBGRS650227 BSBGR1271398 BSBGRS870288

107.31 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.88 100.00 100.86

107.31 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.88 100.00 100.86

0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Bahamas First Holdings Preference Cable Bahamas Series 6 Cable Bahamas Series 8 Cable Bahamas Series 9 Cable Bahamas Series 10 Colina Holdings Class A Fidelity Bank Bahamas Class A Focol Class B

BFHP CAB6 CAB8 CAB9 CAB10 CHLA FBBA FCLB

CORPORATE DEBT - (percentage pricing) 52WK HI 100.00 100.00

52WK LOW 100.00 100.00

115.92 100.00 100.00 100.00 100.00 100.00 100.00 102.00 100.88 100.00 100.66

104.79 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.88 100.00 100.66

SECURITY Fidelity Bank (Note 22 Series B+) Bahamas First Holdings Limited

BAHAMAS GOVERNMENT STOCK - (percentage pricing) Bahamas Note 6.95 (2029) BGS: 2014-12-7Y BGS: 2015-1-7Y BGS: 2014-12-30Y BGS: 2015-1-30Y BGS: 2015-6-7Y BGS: 2015-6-30Y BGS: 2015-10-7Y BGRS FL BSBGR650227 BGRS FX BGR127139 BGRS FL BSBGR870288

CHANGE 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.01 0.00 0.02 0.00 0.00 0.00 0.00 0.00

VOLUME

1,000 50

0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

EPS$ 0.239 0.932 0.000 0.110 0.070 1.760 0.369 -0.438 0.140 0.184 0.449 0.722 0.102 0.467 0.646 0.728 0.816 0.203 0.939 0.631 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000

VOLUME

DIV$ 0.170 1.260 0.020 0.030 0.000 0.000 0.260 0.000 0.000 0.120 0.220 0.720 0.434 0.060 0.328 0.240 0.540 0.120 0.200 0.610 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000

P/E 21.8 34.5 N/M N/M N/M N/M 18.9 -8.1 30.5 15.8 13.2 13.5 24.5 15.0 17.7 12.4 17.2 19.7 8.7 24.6

YIELD 3.27% 3.92% 1.33% 1.15% 0.00% 0.00% 3.74% 0.00% 0.00% 4.14% 3.70% 7.38% 17.36% 0.86% 2.87% 2.66% 3.86% 3.01% 2.44% 3.94%

0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000

0.00% 0.00% 0.00% 0.00% 0.00% 6.25% 7.00% 6.50%

INTEREST Prime + 1.75% 6.25%

19-Oct-2022 30-Sep-2025

6.95% 4.50% 4.50% 6.25% 6.25% 4.50% 6.25% 4.25% 4.66% 5.00% 4.33%

20-Nov-2029 15-Dec-2021 30-Jul-2022 15-Dec-2044 30-Jul-2045 26-Jun-2022 26-Jun-2045 15-Oct-2022 6-Sep-2022 15-Jan-2039 26-Apr-2028

MATURITY

MUTUAL FUNDS 52WK HI 2.43 4.44 2.16 202.18 190.86 1.69 1.81 1.78 1.16 8.58 10.26 7.35 14.59 12.84 10.31 10.00 10.43 14.89

52WK LOW 2.11 3.30 1.68 164.74 116.70 1.67 1.73 1.75 1.03 6.41 7.62 5.66 8.65 10.54 9.57 9.88 8.45 11.20

FUND CFAL Bond Fund CFAL Balanced Fund CFAL Money Market Fund CFAL Global Bond Fund CFAL Global Equity Fund Leno Financial Conservative Fund Leno Financial Aggressive Fund Leno Financial Balanced Fund Leno Financial Global Bond Fund Royal Fidelity Bahamas Opportunities Fund - Secured Balanced Fund Royal Fidelity Bahamas Opportunities Fund - Targeted Equity Fund Royal Fidelity Bahamas Opportunities Fund - Prime Income Fund Royal Fidelity Int'l Fund - Equities Sub Fund Royal Fidelity Int'l Fund - High Yield Fund Royal Fidelity Int'l Fund - Alternative Strategies Fund Colonial Bahamas Fund Class D Colonial Bahamas Fund Class E Colonial Bahamas Fund Class F

NAV 2.43 4.44 2.16 202.18 190.86 1.69 1.75 1.76 1.03 8.58 10.14 7.35 14.59 12.64 9.99 N/A 10.43 14.89

YTD% 12 MTH% 1.47% 4.26% 0.20% 0.87% 0.95% 2.82% 0.14% 5.02% 3.25% 31.13% 0.91% 0.68% -2.55% -3.02% -0.27% -0.27% -2.20% -7.62% 1.14% 4.22% 1.09% 3.04% 1.01% 4.65% 4.93% 42.27% -1.56% 0.80% -0.60% -4.90% N/A N/A 3.00% 25.60% 7.90% 48.70%

NAV Date

30-Apr-2021 30-Apr-2021 30-Apr-2021 31-Mar-2021 31-Mar-2021 30-Apr-2021 30-Apr-2021 30-Apr-2021 30-Apr-2021 28-Mar-2021 28-Mar-2021 28-Mar-2021 28-Mar-2021 28-Mar-2021 28-Mar-2021 31-Mar-2021 31-Mar-2021 31-Mar-2021

MARKET TERMS

BISX ALL SHARE INDEX - 19 Dec 02 = 1,000.00

YIELD - last 12 month dividends divided by closing price

52wk-Hi - Highest closing price in last 52 weeks

Bid $ - Buying price of Colina and Fidelity

52wk-Low - Lowest closing price in last 52 weeks

Ask $ - Selling price of Colina and fidelity

Previous Close - Previous day's weighted price for daily volume

Last Price - Last traded over-the-counter price

Today's Close - Current day's weighted price for daily volume

Weekly Vol. - Trading volume of the prior week

Change - Change in closing price from day to day

EPS $ - A company's reported earnings per share for the last 12 mths

Daily Vol. - Number of total shares traded today

NAV - Net Asset Value

DIV $ - Dividends per share paid in the last 12 months

N/M - Not Meaningful

P/E - Closing price divided by the last 12 month earnings

TO TRADE CALL: CFAL 242-502-7010 | ROYALFIDELITY 242-356-7764 | CAROLISLE 242-502-7525 | LENO 242-396-3225 | BENCHMARK 242-326-7333

THE TRIBUNE

Friday, May 28, 2021, PAGE 7

Taxpayer job ‘band aid’ no longer viable FROM PAGE ONE government still has a significant revenue problem.

Because of this, we are forced to run high, crisistime deficits which are adding to unsustainable debt levels.

“The country is still facing persistent unemployment, and the private sector is contending with business closures. For decades, we have been stuck with anemic growth as key economic sectors have seen declining output.

enjoyed in every subsequent year prior to Hurricane Dorian.

“It’s important that economic growth is robust and sustained,” he said, adding that this will be critical to placing the government’s finances back on a path to achieve a 50 percent debt-toGDP ratio by the 2030-2031 fiscal year.

“Notwithstanding the current dislocation, that has to be something to take the country back to the fiscal consolidation track and a balanced budget,” Mr Johnson said. “Our fiscal deficit remains higher than desirable because the government has been dealing with the twin crises.

He produced data, markedly different from the 24 percent-plus and 14.5

“These long-standing and persistent problems can only be solved if we shift the fundamentals of our economy in a major way. I do not believe that we can tax our way out of our current circumstances. We must grow our way out.”

Marlon Johnson, the Ministry of Finance’s acting financial secretary, described the years since the 2008-2009 global recession as “the lost decade” for The Bahamas and its economy due to the minimal less than two percent GDP growth rates it

percent GDP contractions unveiled by the Department of Statistics for 2020, which was explained on the basis that it was measure by the fiscal year as opposed to the calendar year employed by the Department.

Following a 5.8 percent contraction in the 20202021 fiscal year, Mr Johnson unveiled GDP growth data predicting that the Bahamian economy will expand by 3.9 percent in the upcoming 2021-2022 fiscal year, followed by 6.2 percent and 3.7 percent expansions in the two subsequent fiscal years respectively.

While many observers are likely to dispute such figures, Mr Thompson yesterday admitted that the government “want to be better facilitators of

private sector growth.......

We believe that our country does well when we create a dynamic environment for the private sector to grow and innovate.

“The Accelerate Bahamas Recovery Plan seeks to leverage limited public resources, gathered through the productivity of hardworking Bahamians, in a more strategic way. We will deploy these resources to address the immediate needs of our ongoing recovery and our more fundamental challenges, like revenue shortfalls and anemic growth,” he added.

“Our plan recognises that by expanding and motivating private sector participation, instead of solely relying on direct government payouts, we can create more

THE WEATHER REPORT

5-Day Forecast

TODAY

SATURDAY

SUNDAY

MONDAY

TUESDAY

Partly sunny

Clear

Sunshine and nice

Sunny and pleasant

Clouds and some sun; a thunderstorm

Variable clouds with a thunderstorm

High: 84°

Low: 74°

High: 84° Low: 75°

High: 85° Low: 75°

High: 84° Low: 74°

High: 85° Low: 73°

AccuWeather RealFeel

AccuWeather RealFeel

AccuWeather RealFeel

AccuWeather RealFeel

AccuWeather RealFeel

AccuWeather RealFeel

93° F

78° F

92°-78° F

94°-76° F

93°-74° F

93°-76° F

ORLANDO

TAMPA

High: 89° F/32° C Low: 74° F/23° C

The exclusive AccuWeather RealFeel Temperature® is an index that combines the effects of temperature, wind, humidity, sunshine intensity, cloudiness, precipitation, pressure and elevation on the human body—everything that affects how warm or cold a person feels. Temperatures reflect the high and the low for the day.

N

almanac

E

W

ABACO

S

N

High: 81° F/27° C Low: 75° F/24° C

6-12 knots

S

WEST PALM BEACH High: 89° F/32° C Low: 74° F/23° C

3-6 knots

FT. LAUDERDALE E

W

FREEPORT

High: 87° F/31° C Low: 75° F/24° C

N

S

E

W

High: 84° F/29° C Low: 71° F/22° C

MIAMI

High: 87° F/31° C Low: 75° F/24° C

4-8 knots

Statistics are for Nassau through 2 p.m. yesterday Temperature High ................................................... 82° F/28° C Low .................................................... 73° F/23° C Normal high ....................................... 85° F/30° C Normal low ........................................ 72° F/22° C Last year’s high ................................. 89° F/32° C Last year’s low ................................... 80° F/26° C Precipitation As of 2 p.m. yesterday ................................. 0.00” Year to date ................................................. 3.46” Normal year to date ..................................... 8.11”

ELEUTHERA

Forecasts and graphics provided by AccuWeather, Inc. ©2021

High: 82° F/28° C Low: 75° F/24° C

NASSAU

High: 84° F/29° C Low: 74° F/23° C N

KEY WEST

High: 84° F/29° C Low: 77° F/25° C

High: 82° F/28° C Low: 74° F/23° C

N

S

E

W

6-12 knots

S

tiDes For nassau High

Ht.(ft.)

Low

Ht.(ft.)

Today

9:59 a.m.

10:30 p.m.

2.6 3.5

4:09 a.m. -0.6 4:04 p.m. -0.7

Saturday

10:55 a.m.

11:25 p.m.

2.5 3.3

5:03 a.m. -0.5 4:59 p.m. -0.5

Sunday

11:53 a.m.

-----

2.5 -----

5:59 a.m. -0.3 5:57 p.m. -0.2

Monday

12:22 a.m.

12:54 p.m.

3.1 2.4

6:56 a.m. -0.1 6:58 p.m. 0.1

Tuesday

1:19 a.m.

1:57 p.m.

2.9 2.3

7:54 a.m.

8:02 p.m.

0.0 0.3

Wednesday 2:18 a.m.

3:00 p.m.

2.7 2.4

8:51 a.m.

9:08 p.m.

0.2 0.5

Thursday

2.5 2.4

9:45 a.m. 0.2 10:11 p.m. 0.6

3:16 a.m.

4:00 p.m.

sun anD moon Sunrise Sunset

6:21 a.m.

7:54 p.m.

Moonrise Moonset

10:42 p.m.

8:21 a.m.

Last

New

First

Full

Jun. 2

Jun. 10

Jun. 17

Jun. 24

High: 83° F/28° C Low: 74° F/23° C

High: 82° F/28° C Low: 76° F/24° C

ANDROS

N

High: 84° F/29° C Low: 75° F/24° C

E

W S

LONG ISLAND

tracking map

High: 83° F/28° C Low: 76° F/24° C

7-14 knots

MAYAGUANA High: 83° F/28° C Low: 76° F/24° C

Shown is today’s weather. Temperatures

CROOKED ISLAND / ACKLINS

are today’s highs and tonight’s lows.

RAGGED ISLAND High: 82° F/28° C Low: 76° F/24° C

H

High: 85° F/29° C Low: 77° F/25° C

N E

W

E

W

L

High: 83° F/28° C Low: 76° F/24° C

GREAT INAGUA

N

H

The higher the AccuWeather UV IndexTM number, the greater the need for eye and skin protection.

SAN SALVADOR

GREAT EXUMA

7-14 knots Shown is today’s weather. Temperatures are today’s highs and tonight’s lows.

uV inDex toDay

CAT ISLAND

E

W

To advertise in The Tribune, contact 502-2394

| Go to AccuWeather.com

TONIGHT

High: 93° F/34° C Low: 71° F/22° C

robust pathways to increase employment, stimulate economic activity and therefore increase revenue into the public purse.”

Mr Thompson pledged to “streamline the rules for investors” and attract “high quality” foreign and domestic investment by creating InvestBahamas, which will be established as a promotional agency designed to secure and facilitate foreign capital rather than operating in the reactive manner of the present Bahamas Investment Authority (BIA).

S

S

8-16 knots

8-16 knots

marine Forecast ABACO ANDROS CAT ISLAND CROOKED ISLAND ELEUTHERA FREEPORT GREAT EXUMA GREAT INAGUA LONG ISLAND MAYAGUANA NASSAU RAGGED ISLAND SAN SALVADOR

Today: Saturday: Today: Saturday: Today: Saturday: Today: Saturday: Today: Saturday: Today: Saturday: Today: Saturday: Today: Saturday: Today: Saturday: Today: Saturday: Today: Saturday: Today: Saturday: Today: Saturday:

WINDS SE at 3-6 Knots S at 6-12 Knots SE at 6-12 Knots SE at 6-12 Knots ESE at 7-14 Knots SE at 6-12 Knots E at 8-16 Knots ESE at 8-16 Knots E at 6-12 Knots SE at 6-12 Knots S at 4-8 Knots S at 6-12 Knots SE at 7-14 Knots ESE at 7-14 Knots E at 8-16 Knots ESE at 8-16 Knots E at 8-16 Knots ESE at 7-14 Knots E at 8-16 Knots ESE at 8-16 Knots ESE at 6-12 Knots SE at 7-14 Knots E at 8-16 Knots E at 8-16 Knots SE at 7-14 Knots SE at 6-12 Knots

WAVES 1-3 Feet 1-3 Feet 0-1 Feet 0-1 Feet 2-4 Feet 1-3 Feet 2-4 Feet 1-3 Feet 2-4 Feet 2-4 Feet 1-2 Feet 1-2 Feet 1-2 Feet 0-1 Feet 2-4 Feet 1-3 Feet 1-3 Feet 1-3 Feet 3-5 Feet 2-4 Feet 1-2 Feet 1-2 Feet 1-3 Feet 1-3 Feet 2-4 Feet 2-3 Feet

VISIBILITY 10 Miles 10 Miles 10 Miles 10 Miles 10 Miles 10 Miles 10 Miles 10 Miles 10 Miles 10 Miles 10 Miles 10 Miles 10 Miles 10 Miles 6 Miles 10 Miles 10 Miles 10 Miles 10 Miles 10 Miles 10 Miles 10 Miles 10 Miles 10 Miles 10 Miles 10 Miles

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PAGE 8, Friday, May 28, 2021

Bahamas ‘can’t alter taxation on a dime’ FROM PAGE ONE

structure, and in an almost nonchalant way are saying change this, change that,” the minister argued. “I don’t believe the Ministry of Finance has the luxury of changing on a dime when it comes to tax structure....

“We want to be datadriven, not do this stuff haphazardly. We cannot make changes at a whim without having data. What we’re committed to doing, once the results come in, is to have a dialogue and discussion with the public on what they are.”

The prime minister, in unveiling the budget on Wednesday, said the Ministry of Finance was engaged in “a diagnostic review” of tax policy and administration, as well as an expenditure assessment, as it moves “to have equity and fairness in taxes, and efficiency and impact in expenditures”.

On the diagnostic study, he disclosed: “This study will examine the government’s current sources of taxation, revenue trends and will explore issues such as equity and efficiency in our tax practices.

“At the completion of this exercise, we intend to publish the findings in a white paper to garner feedback from key stakeholders and the general public on how the government should proceed with our ongoing tax reform efforts.”

As for the spending side, the prime minister added: “We plan to complete the public expenditure review,

which has already commenced with the support of the Inter-American Development Bank (IDB). The goal of this study is to identify areas where there are low efficiencies, duplication or other areas where the government can reduce spending to close the gap between revenue and expenditure.

“We are moving towards a system where we will no longer have to pay for the same service multiple times while the public receives limited benefits. Ultimately, the study will provide a planning framework for achieving a more targeted and efficient management of total expenditure, from year to year.”

No mention was made in the budget communication of the growing global push for a minimum global corporate tax rate, with the US having suggested that 15 percent be set as a “floor” or starting point with the issue set to be discussed at the upcoming G-7 summit of the world’s major industrialised nations.

Should the initiative gain momentum, and be adopted as a global standard, it would have profound implications for both The Bahamas’ tax structure and the value proposition for its financial services industry, which has long competed on the basis of being a “no tax” jurisdiction.

Meanwhile, Mr Thompson said the multiple tax breaks and investment incentives unveiled in the budget will be paid for by the $50m in revenue enhancement

THE TRIBUNE measures involving vacation rentals and real estate that were unveiled in the 20212022 budget.

“This budget strikes a necessary balance,” he added.

“It provides very targeted and focused tax breaks and concessions that are principally geared on accelerating the pace of economic activity and recovery.

“Most importantly, all of the tax breaks and concessions are paid for by the incremental tax measures outlined in the budget. We made the deliberate decision that the concessions would have to be matched with corresponding revenue gains to pay for them.”

He later reiterated: “We saw it as our responsibility not to create tax concessions on one side without having the necessary revenue measures to balance it. That took into account the situation of where we are at. It takes into account the economic reality of where we are, our debt levels and strategy of reducing the debt as well.

“It’s a balanced approach that the Ministry of Finance was able to get. We’re also able to say that those tax concessions are for those people that really need it, and those intended to stimulate economic activity are good. At the same time, we cannot be reckless and not find a way to make up for those revenues.”

Marlon Johnson, the Ministry of Finance’s acting financial secretary, said the various tax breaks and incentives unveiled by the government were likely to forego between $24-$25m in revenue. He added that the government believes it may be able to collect more than the targeted extra $31m from the vacation rental home market.

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$10bn national debt ‘elephant in the room’ FROM PAGE ONE that the current fiscal year, and the one to come, have elevated borrowing by some $2bn. As the prime minister said yesterday, in this administration we do not gloss over this fact.

“The $1.3bn projected deficit this current fiscal year, and the $951m deficit projected for the 2021-2022 fiscal year, reflect the extreme economic crisis caused by Dorian and the pandemic, and our response to these crises. This is what has caused us to postpone - only temporarily - the path to fiscal consolidation and balanced budgets that we were pursuing with great success.”

Acknowledging the ongoing debate over the government’s fiscal and economic policies, Mr Thompson added: “Some will say take care of the people, take care of the people, now is not the time to focus on debt reduction, and others will say this is unsustainable and we must stop the spending and tax breaks or even raise taxes to reduce the debt level. This budget strikes a necessary balance.”

Turning to the Debt Management Act, Mr Thompson said: “That will require a unit to be formed to increase capacity and for the debt management strategy be published. In addition, we will remain focused on meeting the targets in our fiscal strategy to reduce the deficit to acceptable levels with fiscal discipline, sinking funds and economic policies that accelerate growth.”

He gave no indication of the details that will be included in the debt management strategy. However Marlon Johnson, the Ministry of Finance’s acting financial secretary, yesterday said the government plans to place up to $775m into so-called “sinking funds” that will be used to pay-off

specific debt issues as they mature.

No contributions were made to these so-called sinking funds this fiscal year, though, due to COVID-19’s impact on the government’s finances. Mr Johnson said the ministry will also seek to access lending facilities provided by multilateral financial institutions in bid to obtain lower interest rates, and more favourable terms and payback periods, while converting variable rate issues to fixed.

He added, though, that while the near-$10bn national debt and elevated annual fiscal deficits were “a cause for concern but not a reason for alarm” because they represented the “temporary and transitory” effects of COVID-19 and Hurricane Dorian rather than any deep-rooted

structural problems with the government’s finances.

Mr Johnson justified this on the basis that the government’s annual fiscal deficit has already started to drop from the COVID crisis peak of $1.327bn this fiscal year to the projected $951.8m in 2021-2022, adding that it would have remained the same or increased if there any structural woes afoot.

Mr Thompson, meanwhile, conceding that the government had initially expected its unemployment benefit assistance to be required for just three to four months, added that it will be extended until September 2021 after which anyone still needing support will be switched to the Department of Social Services.

Mr Johnson said the latter agency had seen a $20m “bump up” in its budget allocation to enable it to cope, taking its social assistance benefits from $42.487m in the current budget year to $63.036m in 2021-2022.