"Most substantially Mr. Speaker, the Government is proposing an increase in the rate of Value Added Tax from the current 7.5 % to 12% percent effective July 1st."

"As for measures that that we are implementing to meet our commitments to Bahamians and provide tax relief to individuals and businesses:
effective August 1, we are eliminating VAT on all breadbasket items, with the exception of sugar, as sugar will – for health reasons – be removed from the list of breadbasket items.  This would mean the elimination of VAT on the following items:

• Butter
• Cooking Oil
• Mayonnaise
• Grits
• Cheese
• Corned Beef
• Evaporated Milk
• Margarine
• Rice
• Flour
• Bread
• Tomato Paste
• Baby Cereal
• Baby Formula
• Soup
• Broths
• Baby Food
• Powdered Detergents
• Condensed Milk
• Soaps
• Fresh Milk
• Mustard

• We are eliminating VAT on medicines;
• We are eliminating VAT on residential property insurance;
• We are waiving VAT on residential electricity bills at or under $100 and water bills at or under $50; for clarity, this is not for the first $100 or $50 in a person’s bills, but it is targeted at those bills which come in at or under the stated amounts.  For electricity customers, this would impact over 30,000 BPL households alone.  For water customers, this would impact some 43,000 Water & Sewerage customers.   This waiver will be applicable to all licensed utilities in the country.
• we are increasing the Customs personal travel exemption from $300 to $500 per person;
• we are providing for the VAT zero-rating of fund-raising activities held by charitable organizations;
• we are implementing various concessions in respect of Real Property Tax, Customs duties, Excise duties, Business License fees and Stamp Tax in favour of designated Economic Empowerment Zones, beginning with the “over-the-hill” community;
• we are providing for the waiver of duty on clothing and shoe imports upon application by importers and retailers of same.  This will be extended to any merchant, large or small, who has a business license for the sale of clothes or shoes.   We are at the same time putting in place procedures to ensure that the savings are passed on to consumers.  This will be a benefit to all Bahamians, but particularly to those who do not have the means to travel abroad to shop for their clothes like others are sometimes able to do;
• we are providing duty-free entry for goods for use in the commercial printing industry, as well as for processing and garment manufacturing equipment without the need to apply for specific concessions as before;
• we are extending for one year both the City of Nassau Revitalization Act and the Family Island Development Encouragement Act;
• we are extending for 5 years the first-time homeowners Stamp tax exemption;
• we are extending for 2 years the duty exemption on materials used for the renovation, repair and upgrade of dilapidated buildings;
• we are eliminating duties on a number of food products, including: whole salmon; frozen fish fillets; bread spreads; potato products; tofu; and prepared and preserved tomatoes;
• we are eliminating duties on solar kits upon application to the Ministry of Finance.  Presently solar panels are duty free, and this new allowance will mean that vendors or individuals who are bringing in full solar kits can have all related elements brought in duty free.
• we are reducing duties on floor tiles and fabric softener;
• we are extending the 0.75 per cent Business License fee rate, currently applicable to hotels with turnover over $400 million, to all hotels with 10 rooms or more so that
• smaller Bahamian owned hotels can take advantage of the concession that was offered to the larger foreign owned properties;
• we are extending the duty exemption to church buses 8 years old or less from the current limitation that limits the concession to buses that are 3 years old or less;
• we are providing an exemption from Business License fees for all schools that are registered with the Ministry of Education; and
• we are eliminating the duty on airplanes and helicopters in an effort to build an Airplane Registry Industry within the country.

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