In a statement outlining the 2012-13 mid-year budget, Christie told legislators that in order to achieve these initiatives, recurrent revenue will be significantly and structurally enhanced through a wide range of measures.
He said the government is establishing a Central Revenue Agency to strengthen the efficiency and effectiveness of revenue collection and is also implementing a broad tax reform package that includes the introduction of a Value Added Tax (VAT) in July 2014.
“While that is an ambitious timeframe, I would note that we have had the benefit of detailed studies of the feasibility of VAT in The Bahamas.
“The White Paper contains a fully articulated policy framework for VAT. Following the public consultation process, the Government will present a refined proposal, and advanced legislation to bring VAT into effect.
“Our target is to circulate the draft legislation for VAT by the second quarter of the next fiscal year. With the introduction of VAT, along with the reduction in other taxes set out in the White Paper, we expect a net 2.2 percentage points of GDP improvement to Recurrent Revenue annually,” he said.
Prime Minister Christie said that his administration is also committed to wide-ranging reforms of the property tax administrative system that will add one per cent of gross domestic product (GDP) to recurrent revenues by 2016/17.
He said the government is also undertaking a comprehensive Customs reform and modernisation programme, assisted by the Inter-American Development Bank that will add revenues equivalent to 0.5 per cent of GDP.
Reprinted from Cananews