23/06/21

BAHAMAS: Govt to publish white paper on tax study findings.

As published on ewnews.com, Wednesday 23 June, 2021.

NASSAU, BAHAMAS — The government expects to have preliminary results of its tax study by year’s end, according to State Minister for Finance Kwasi Thompson, who noted a white paper on the findings of that study will be published.

While making his contribution to the 2021/2022 budget debate in the Senate yesterday, Thompson said: “Our Resilient Bahamas plan laid out and executed a strategy that has kept the government solvent, that has allowed for hundreds of millions of dollars in direct support to Bahamians and that has ensured that our Bahamian dollar has remained as strong as it ever has been.

“Because we confront the gravity of the situation with resolve and resilience, we have indicated that this administration will continue on tax reform efforts, as was recommended by the Economic Recovery Committee (ERC).

“We have accepted their position that tax reform must continue and that we must improve our framework to move toward more fair and more equitable taxation across the country. We also agreed with the ERC that any future significant reform should be preceded by an in-depth empirical assessment regarding the efficiency of our tax systems and the relative burdens of taxation in the country.”

To that end, Thompson noted preliminary work has already begun.

“By September of 2021, the study will be in full swing and we will likely have preliminary results by end of the year,” said Thompson.

“We will publish a white paper on the findings of the study and will ensure broad consultation and input from the public regarding the outcomes of the assessment. We want to ensure that whatever significant changes we propose to the tax framework, that these changes are informed by reasoned and empirical analysis and not simply the conjecture and posturing that too often gets attention when matters such as this are raised in the public domain.

“At the end of the day, we want to ensure that we reform our tax system in a way that supports even greater opportunities for Bahamians to thrive in our country.”

Thompson noted a discussion on tax reform is timely in light of the recent declaration of the G7.

“This grouping, which represents the world’s largest economies, has indicated that it will seek to impose a minimum tax rate on large businesses that operate within their borders, regardless of where the headquarters of these businesses may reside,” said Thompson.

“They have indicated that they will not permit these businesses to book the entirety of their profits in so-called ‘low-tax’ jurisdictions.

“This administration has gone on record to assert the sovereign right of The Bahamas to maintain a tax system that is best suited for the current and future needs of The Bahamas. Indeed, the Bahamas has representation at the table where these discussions are taking place.

“We continue to work with other similar established and credible international financial centers to remind the international community that we have been meeting and will continue to meet all conventions and treaties to which we are signatories.”