The VAT Story

Posted by Tonia Ferguson/ Devaldo Greene 
on Feb 17, 2014
 
 
 
Pastors are talking about it.  Members of Parliament are talking about it.  Businesses are talking about it.  Consumers are disgusted with it.  And it does not even exist!  What is it?  VAT – Value Added Tax: Indirect tax on the domestic consumption of goods and services, except those that are zero-rated (such as food and essential drugs) or are otherwise exempt (such as exports). It is levied at each stage in the chain of production and distribution from raw materials to the final sale based on the value (price) added at each stage. It is not a cost to the producer or the distribution chain members, and whereas its full brunt is borne by the end consumer, it avoids the double taxation (tax on tax) of a direct sales tax. – Business Dictionary
 
This past Thursday Rotarians of the Sunrise Club listened to “The VAT Story” as told by Tamara Van Breugel. Mrs. Van Breugel, a Bahamian citizen whose family owns and operates a small business located in Down Town Nassau was detailed in her address to the Rotarians who listened intently to her scholarly findings about VAT. Mrs. Van Breugel, while admitting that she is “by no means an expert on economic theory or taxation, I am not a representative of any political persuasion, and I have no special interest ties other than a special interest in the growth and prosperity of the Bahamas and of every Bahamian man, woman and child”, is affiliated with Citizens For A Better Business”, and listed her findings below about VAT:
  • VAT is a regressive form of taxation.
  • VAT is complex.
  • VAT will increase our cost of living.
  • VAT is prone to fraud.
  • VAT has not been a success in our region.
  • VAT works best in well-ordered societies.
  • VAT’s implementation timelines are unrealistic.
While outlining the non-partisan citizen’s advocacy group’s objectives, she believes that there exist alternatives to the implementation of VAT. Her suggestions directed to the Government, include a reduction in spending, enacting fiscal rules, the collection of outstanding taxes, reevaluating concessions, supplying additional information to the populace, and the introduction of sales tax.
 
In closing, Tamara Van Breugel, made a plea for the Rotarians to sign the petition indicating “No to VAT” on the Citizens For A Better Bahamas’ website – www.citizensforabetterbahamas.org.