A local author on the Bahamian economy has outrightly condemned a provision in last week's tabled value-added tax (VAT) legislation that exempted gambling from the controversial tax, urging Bahamians to "refuse to accept and comply with VAT" until the exemption is revoked.
Dr. Jonathan Rodgers, ophthalmologist and author of two books on the Bahamian economy, decried the exemption, arguing that the government should tax gaming services not least because of the resources the government had invested in official studies on gaming regularization and the January 2013 referendum on the industry.
"Now that the government has been forced to introduce VAT because of the total mismanagement of the Bahamian economy...it is exempting the very entities who could, should and can afford to pay their fair share of taxes," wrote Rodgers in an opinion piece issued to Guardian Business (see full opinion piece on page four).
"It seems to me that government has spent an inordinate amount of time, money (public funding) and effort and lost a tremendous amount of integrity in its attempt to regularize an illegal industry, when this country has a myriad of other far more pressing and important issues that need to be addressed."
Rodgers feels that Bahamian citizens should take action against the exemptions for both the gaming and banking industries.
"I would urge all Bahamians to stand up and refuse to accept and comply with VAT until the numbers industry and the banks become VAT-able and the politicians pay their dues."
Coalition for Responsible Taxation (CRT) Co-chair Robert Myers also had reservations concerning the exemption, but felt that further clarification was needed ahead of meetings between the CRT and the Ministry of Finance.
"On the face of it, we'd be opposed to tickets being VAT free," said Myers. He added, "We have to get some more context and evaluate it."
"Locally, if you can afford to gamble, you should pay VAT. If one has to pay VAT on medicine, food, and goods and services, you should be paying it on a lottery ticket," stated Myers.
Myers suspected that the stipulation, which exempts games of chance, gambling and lotteries within the meaning of the Lotteries and Gaming Act from VAT, was added to protect casino gambling from additional taxation.
"I think they're wrapping that in with the casinos...[because] they don't want to have VAT on the casinos...but we want to get more clarity and depth on what exactly the intent was," said Myers.
The new VAT regulations were tabled before the House of Assembly Wednesday afternoon. VAT will be implemented at a flat rate of 7.5 percent beginning January 1, 2015. Few services and no goods are exempted from the tax.

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