Sands: Need for BCA meeting to address Baha Mar tax exemption concerns

Thu, Jan 5th 2017, 11:58 PM

The president of the Bahamian Contractors Association (BCA) has asserted the need for a stakeholder meeting with all BCA members in order to clear up any hiccups or concerns that news of the VAT concession given by government to China Construction America (CCA) Bahamas Limited to complete the Baha Mar resort, may have brought about.
"We would like to have an opportunity to advise all contractors doing business with CCA, and the nature of the arrangement in which they would be conducting business," said Leonard Sands during an interview with Guardian Business yesterday. "If we don't have an opportunity to truly advise and appraise them of what the risks are, they could end up in a precarious position."
Sands argued that there should be some type of agreement with local suppliers and the involvement of the Ministry of Finance to help enforce the VAT exemption properly.
"They are not going to pay you any invoice that has VAT. So, if you don't have it sorted out properly, you are going to lose money."
According to Sands, the economy will lose out on a huge chunk of revenue as a result of the VAT concession. He also revealed that he thinks the concession is not such a "big deal", adding that local suppliers will benefit from construction activity and local contractors would prefer to be VAT exempt as well. "For the construction industry, we prefer not to be paying VAT anyways," Sands told Guardian Business.
"While the government has given the project this wonderful opportunity, our job would be to ensure that this opportunity doesn't become an onerous
situation for our members who of course are doing business with this major developer (Chow Tai Fook Enterprises) and CCA Bahamas," said Sands.
He also disagreed to some extent with Attorney General Allyson Maynard-Gibson's comments on the matter, who charged that the benefits from the Baha Mar project being completed and operational would far outweigh the concessions granted by the government.
"I don't know if it's fair to say that the benefits would far outweigh the concessions. I think the benefits would outweigh the concessions on the premise of if the resort opens, becomes successful and hires thousands of Bahamians," he said.
He also expressed concerns over the agreement for subcontractors who previously performed work on the project and have been re-engaged. Sands queried what the outcome would be for those subcontractors who get supplies locally with their own monies and are charged VAT.
The email revealing the VAT exemption directs all subcontractors of CCA to present invoices for payment that are devoid of VAT charges.
The email continued: "If you have paid VAT to the government or your own subcontractors and/or suppliers, please record these invoices as listed in the attached summary form and submit to CCA for the review and process of the Bahamas authority."

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