Prime Minister Perry Christie yesterday outlined a broad program of tax breaks as part of a fiscal plan to "provide relief to consumers and businesses". In addition to the decision to replace all remaining rates of duty of seven percent with a five percent rate, Christie outlined a number of tax breaks related to real property tax.
For instance, the administration proposes to provide customs duty exemptions and real property tax concessions to owners of derelict buildings in New Providence who intend to demolish and/or renovate these buildings for commercial, educational or social purposes.
The administration also proposes to allow the real property tax concessions granted to residential properties last year to be extended to commercial properties with the exception of properties which are now subject to collection, and to allow for the waiver of real property tax arrears for owner-occupied properties with values less than $250,000, which Christie said could potentially benefit over 41,000 homeowners.
In addition the administration proposes to extend the City of Nassau Revitalization Act for another year to June 30, 2017; to extend the Family Island Development Encouragement Act for another year to June 30, 2017; and to expand the tariff concessions available to light manufacturing by allowing items not on the approved list to be granted full duty exemption "on approval of the minister".
Other breaks include the decision to allow churches to import air conditioners duty free, and to reduce or eliminate the duty on a number of household and grocery items, including appliances and parts, prepared turkey, ham, beef and chicken meat, macaroni, spaghetti with meat and the like, ice cream, biscuits, waffles, cakes and pastries among others.
The administration proposes to eliminate the duty on baby clothes and reduce the duty on used clothing and on costume jewellery, perfumes and certain leather goods; to reduce the duty rate on computer peripherals, routers and related items, and to reduce or eliminate the duty on various building materials such as plywood, sheet rock, cement, roofing tiles and shingles, electrical wiring, marble and granite and other stones among others.
Christie also plans to reduce the environmental levy on used tires to reflect the low value cost of such imports, and exempt from VAT ancillary fees paid along with tuition fees.
"We will develop a framework to allow the Minister of Finance to take steps through the Tariff Act to protect Bahamian agricultural and manufactured products," Christie said.
He added that the administration will allow for the waiver of Stamp Tax and VAT on Deeds of Exchange because of errors in property description, amend the Stamp Tax Act to reduce the rate of tax to 2.5 percent on marina slips, as with other conveyances, allow stamp tax concessions/exemptions to be granted to first-time homeowners who may have missed the opportunity due to non-submission of documents for stamping, and provide a full amnesty on the surcharge which is now applied for late stamping of conveyances and other documents for 90 days and the application of a fixed penalty of 10 percent of the applicable stamp duty thereafter.
Tax administration
Meanwhile, the prime minister added that his administration is introducing measures to improve the administration of, and compliance with, major taxes.
"Namely, we are proposing to adjust the requirement of the Tax Compliance Certificate to cover major shareholders with over 20 percent of the shares as well as companies with similar shareholders; increase the enforcement provisions under the Excise Stamp (Tobacco Products) Control Act to allow for the compounding of penalties and for Customs officers to better monitor tobacco manufacturing; amend the Stamp Act to clarify the meaning of transaction values such that stamp tax can be properly assessed (and) adjust the date for the submission of VAT payments to 21 days after the end of the month, with effect from January 1, 2017," Christie said.
He added that the government will require that non-profit entities and charities be designated as such by the Registrar General or the Attorney General before qualify for duty-free concessions, and will amend the Stamp Tax Act to adjust and eliminate a number of the fees.
K. Quincy Parker, Guardian Business Editor
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