Bahamians are trying to cope with the significant cost of living increase since the introduction of value-added tax (VAT) at 7.5 percent at the beginning of this year. Along with passing on the consumption tax to consumers, businesses have had to raise prices even more to compensate for VAT-related implementation costs.
VAT was instituted - the Progressive Liberal Party (PLP) said at the time - to help reduce our deficits and to pay down debt. Since then, however, the governing party has suggested that VAT proceeds would help pay for social programs the country "needs" - that is, more wasteful government spending.
The PLP seems tone deaf to the concerns of Bahamians when it comes to tax increases. Instead of allowing voters a moment to adjust to VAT, the governing party is giddily preparing for its next assault on Bahamian taxpayers via the National Health Insurance (NHI) scheme.
People like PLP MP for Fort Charlotte Dr. Andre Rollins and former Free National Movement (FNM) Senator Dr. Duane Sands have said publicly that now is not the time to tax the Bahamian people further. The national unemployment rate was last measured at 15.7 percent in November 2014. Youth unemployment stood at 31 percent. These are difficult times.
A report on NHI completed by Costa Rican consultants Sanigest Internacional revealed that implementing the scheme would cost taxpayers between $362 million for a basic benefits package and $633 million for an expanded package annually. The report proposes three revenue scenarios to pay for NHI.
Under the low scenario, payroll contributions would not be introduced beyond the one percent approved for the National Prescription Drug Plan. This scenario calls for limited additional taxes assessed on auto and other insurance policies and only a partial transfer of existing government health spending.
Under the medium scenario, contributions of three percent would be introduced, with two percent split between employers and employees, with a National Insurance Board (NIB) wage ceiling increase to $800. The current NIB wage ceiling is $620 per week.
Under the high scenario, contributions of five percent would be introduced, with a wage ceiling increase to $1,200. The medium and high scenario also call for additional taxes on alcohol and tobacco, auto insurance and other insurance, and nearly all-existing government funding of healthcare would be channeled to NHI.
Christie said in March that if the government was to "hesitate again" to implement NHI, hundreds of people would die because they cannot afford adequate healthcare. Several months before the 2007 general election, the first Christie administration brought the NHI Bill to Parliament. It was passed, but the election took place before promised regulations to flesh out the details of NHI were presented.
"And you have to call a spade a spade because if we hesitate again, there are people by the hundreds, who when we analyze why they died, it will be because they didn't have the means or even the knowledge or they didn't live in a country that provided [healthcare] through the intervention of the state and would be subject to the same animalistic manifestation that only the strongest survive," Christie said as he addressed the 9th International Labour Organization (ILO) meeting of the Caribbean Ministers of Labour at the British Colonial Hilton.
"That's the choice we have."
Christie should realize that the Bahamian people now only see their spending power decreasing under the weight of the taxes implemented by this government. Many Bahamians think health reform is important. But they also know they cannot afford to give one more dollar to the state. If they do they will be unable to pay their electricity bills, school fees for their children and their mortgages.
Christie should know his party is not popular. Three years in to this term and the murder rate is near record levels and people still can't find work. The only economic plan the PLP has is Baha Mar, which was a deal cemented by the last FNM administration.
Taking more from a frustrated people will not gain votes for the PLP at the next general election. Christie must remember that in the run-up to the 2007 general election he thought he was doing what the people wanted. Clearly he was not, as they voted his party out of office.
This time he should know that the people do not want more tax increases. Gradually improving the health care sector is necessary but it does not have to be done in the manner being considered by this government.
If Christie wants to be prime minister again he should think long and hard about NHI. Those with little, who will be asked to pay more, will not be happy with the party that emptied their pockets.
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