The announcement was made by Ehurd Cunningham, secretary for revenue at the Ministry of Finance, who was speaking at the 18th General Assembly and Technical Conference of the Caribbean Organisation for Tax Administrators (COTA) on Tuesday. The Bahamas is hosting the conference this year, at the Radisson Cable Beach Resort.
Mr Cunningham’s presentation was entitled “Management Strategies for Protecting Revenue.” He said it was about showing the importance of government collecting all revenue due to it in order for it to properly do its job.
He said, “So before we would introduce a VAT, we really want to ensure that we are collecting the maximum revenue from all sources now, because it may be that, at the end of the day, if we are getting the revenue that should come into the government, there is no need for any additional source.”
Alternatively, Mr Cunningham added, that even with maximum revenue collection, the government might find an additional source of revenue necessary. In this regard, he said the amount of that new tax would be based on the existing incoming revenue. “So if we can maximise what is already on the books, it means that any new tax could be at a much lower rate,” he said.
Mr Cunningham pointed out that, unlike many other countries, tax administration in The Bahamas was a more difficult process since the country collected revenue from a variety of agencies to include customs duties, real property taxes, hotel union taxes, gaming taxes, road traffic taxes, taxes through the generation of treasury funds and taxes from the Registrar General. “And it’s really left to the ministry of finance that has responsibility for government revenue to deal with it. It’s not the simplest thing to administer,” he said, adding that the ministry was now looking at the possibility of combining a number of the above mentioned agencies under one umbrella to create a system that would be easier to administer.
Mr Cunningham’s views were in sync with those of the Minister of State for Finance, James Smith, who on Monday, the opening day of the conference, said the results of a government study on the Bahamian taxation system was expected to be released at the end of the year. Mr Smith further said that The Bahamas would consider a VAT if present methods of revenue collection failed to produce the desired results.
Meantime, Mr Cunningham said one of the revenue enhancing initiatives was already being implemented. He was referring to the government installing a cash receipting system to eventually phase out manual receipts at government corporations. A computer would generate the receipt and provide statistical data on government revenue so that the revenue could be better monitored. “Also this would allow us to have more details when we do forecasting in the future,” he said.
Additionally, Mr Cunningham said government departments were now moving towards accepting all major credit cards. “We are in discussions with banks now on that, and I’m hoping that maybe by the year-end, we can have a system in place.” Presently, only Suncard, the Bahamian credit card, is accepted at government corporations.
Regarding revenue collection operations at Bahamas Customs, Mr Cunningham said the government had engaged a U.K. government agency, Crown Agents, which performs management and technical work for mainly former colonies. The company would be working to improve the Customs Department’s administrative machinery and to promote the use of technology.
Another point raised by Mr Cunningham was a personal identification card for each Bahamian and permanent resident. He said the system was getting serious consideration in the ministry. With the card, each individual or company would be assigned a specific number that could easily be tracked thereby improving revenue collection.
Also on Tuesday, presentations were made by Belize, Suriname and the Organization of American States (OAS).
Today, delegates will focus on The Bahamas’ tax administration, and on Thursday, papers will be presented on “Managing Resources for Optimum Performance in Taxation;” “The Impact of Extra Regional Double Taxation Agreements on CARICOM Social;” and “Skills Development in Evaluating, Negotiating and Administering Double Taxation Agreements.” The forum will end with a general assembly administrative session.
COTA is comprised of tax administration agencies of the Commonwealth Caribbean territories. The theme for the four-day conference is “Linking Advances in Taxation with Human Resources and National Environment.”
Mindell Small, The Nassau Guardian
