Bahamas the
This article was added by the user . TheWorldNews is not responsible for the content of the platform.

Recent bright spots for The Bahamas

Dear Editor,

Informed observers have long understood the persistence of regressive tax policies to be one of our biggest development challenges since independence.

In this regard, the two recent news events indicating a shift towards a tax regime focused on income and property, rather than consumption, were very encouraging developments.

Of course, in my opinion, both matters could very easily have been approached better in terms of communication.

Only PLP Chairman Fred Mitchell appears to have struck the right tone publicly.

Government could and should have been clearer in highlighting that the move to exercise powers of sale for tax delinquent properties is aimed essentially at foreign owners. In this, they are aided by the work of earlier governments, which already exempted Bahamian-owned properties from taxation in the Family Islands, where most of the abuse occurs.

(Why this was so difficult to point out is a mystery, considering that foreigners don’t even vote!)

In terms of corporate income tax, government should also not have shied away from the fact that it will never work without personal income tax also – for the reasons that the ever-thoughtful and informed Mr. Gowon Bowe has already spoken to (i.e. greedy shareholders could otherwise simply pay themselves huge directors’ fees in place of taxable dividends).

But there are two additional current issues making the news in much of the Caribbean in recent weeks (though, typically, not here), both of which paint The Bahamas in an encouraging light.

One is our outperformance of virtually all of our regional peers in recovering the wealth per capita lost over the years of pandemic and lockdown.

While leaders of the tourism industry point to pent up demand for international travel in the United States and the resulting strong recovery of tourist numbers, this is something shared with other regional countries, none of which experienced so sharp a rebound in their domestic economies.

Jamaica (with a similarly strong recovery in tourism numbers) grew its domestic economy by four percent in 2022. The Bahamas’ grew by more than 12 percent.

The obvious reason is that, uniquely in the region, Bahamians enjoyed National Insurance unemployment payments throughout the pandemic. This permitted Bahamian consumers to end the period of inactivity with substantial (albeit reduced) spending power still in their hands.

This, in turn, translated immediately into a resurgence of domestic demand, which ultimately dovetailed with and complemented the more explicitly observed rebound in tourist numbers.

This fact should not be lost on policymakers when it comes to other opportunities to deepen social benefits – like universal health care.

The other current regional matter relates to the Jamaican government’s incredible decision to raise their own parliamentary and ministerial salaries by as much as 300 percent.

Numerous Jamaican and Caribbean critics of the move quickly pointed out that The Bahamas, with average salaries that are seven times higher than those in Jamaica, actually has the lowest paid prime minister among a sampling of five major CARICOM countries, while Jamaica has the highest.

In fact, our prime minister takes home only 2.6 times our GDP per capita in income, while Trinidad’s makes 5.3 times as much as theirs and Jamaica’s makes an incredible 40 times theirs.

This should make thinking Bahamians both proud and determined not to follow our regional peers in such matters.

Andrew Allen