Announcing the Bahamas budget this week, Finance Minister Ms Allyson Maynard-Gibson detailed changes in the valuation of property for taxation purposes, an increase in premium tax for insurance companies and future reform of casino tax in addition to outlining developments in financial services regulation and e-business.
“Citizens should be reminded that one of the revenue enhancing measures that will be taken in the current year is the revaluation of property so that the true value of real property tax is collected. A quick analysis of the difference in sales value and valuation for real property tax purposes is instructive. In 1994-95 the total market value of IB matters (certificates and permits) was some $123 million. The value of those properties for real property tax purposes was some $7.9 million. The figures for the year 2002-03 are equally instructive. In 2002-03 the total market value of IB matters (permits and certificates) was some $1.02 billion. The value of those properties for real property tax purposes was some $211 million. Clearly revaluation of properties for real property tax purpose will have significant impact on our revenue.”
“In relation to casino taxation in the Bahamas, the Corporation has commenced an updated study of casino taxation in other major jurisdictions to facilitate a review by Government with a view to ensuring the profitability of Bahamian casinos and equitable tax returns to the Government. An inter-departmental committee representing the Ministry of Finance, Ministry of Tourism, Ministry of Financial Services & Investments, the Hotel Corporation and the Gaming Board, are examining the study and will be shortly making recommendations for consideration by the Government. This is especially important in relation to revenue-generating measures by the government.”
“When this Government assumed office, the country was facing significant challenges in the Financial Services Sector and foreign direct investments were stagnant. We have over the last 12 months or so, taken vigorous measures to address many of the uncertainties in the financial services sector. Yes, we have brought some degree of stability to the sector. Perhaps most significant is the spirit of change, openness, participation, consultation and responsiveness that pervades the sector.”
“Mr. Speaker, business thrives in a transparent environment where the rule and objectives are known. More importantly, it thrives where those who are responsible for the success of business are actively involved in the process of identifying priorities and process by which the priorities will be achieved. The Strategic Plan was developed through a broad and varying input from the industry and developed principally in partnership with BFSB.”
“I wish to highlight the steps taken to date to achieve objectives. In so doing, it is important to recognize that while progress has been made there still are significant goals to be accomplished e.g. improving the clarification and consistency in application of policies, minimizing the bureaucracy, streamlining regulatory processes and the KYC regime remain priorities.”
A procedure for incorporating companies over the counter and via the Internet is now in place.
A programme for updating the records of the Companies Section has been implemented.
A Shift System has been implemented to deal with companies that are filed late in the afternoon, so that they can be ready for signature when the office opens at 9:00 a.m.
There is a schedule for Registrars to sign Company Incorporated documents that were posted.
A programme for updating the records of the Companies Section has been implemented.
“At the request of industry, imminently we shall dedicate an officer to processing and expediting Memoranda and Articles of Association for Mutual Funds.”
“The Sector regards these as two key issues. Much work remains to accomplish these goals. But, consistent progress is being made through regular meetings of group of regulators signatories to the Memorandum of Understanding. We eagerly await the report of the FSCF sub-committee to report on the way forward. In the meantime we note that the Central Bank is working actively with clearing banks, AIBT and BACO to formulate agreed standards for KYC. Also, many practical steps being taken – BFSB, BFA (Bahamas Funds Association) Clearing Banks, Central Bank & Securities Commission working to achieve clearly defined best practice standards for establishing accounts with for our second largest sector of the FS industry – investment funds.”
“As was indicated as I commenced this address, revenue enhancing measures are key in this Budget, as we await our IMF country rating. Fees in the Registrar of Insurance’s office have not been increased since 1985. As indicated by the Prime Minister, the government has decided to increase the premium tax paid by the insurance companies in lieu of business license fees. This decision was not made lightly but after consultation with the sector. The government is aware of and has listened carefully to the Insurance Industry concerns on the need to improve efficiency of the office of the ROI and the regulatory process for that Industry. We share these concerns. Increased fees would provide for this improvement and the government is committed to ensuring that a significant part of the increase will be allocated to the regulatory regime. The ability to make this commitment is ground breaking and it is hoped that the sector will continue to lend its support to the effort to make the Bahamas a jurisdiction of choice for insurance.”
By Amanda Banks, Tax-News.com
