bahamiangoddess
05-29-08, - 12:58 PM
Customs changes pave the way for WTO membership
By VERNON CLEMENT JONES, Guardian Business Editor, vernon@nasguard.com
The government is keen on streamlining its tax regime, moving, said the Prime Minister yesterday, to roll duties and stamp tax into one more-easily understood import fee as well as transferring, in some cases, the point of taxation altogether.
"One year ago, in presenting my government's first budget in this term of office, I signaled (our) stand on fiscal matters, particularly on taxation," he said, as part of his Budget communication for 2008/9. "I advised of my government's intention, consistent with our Manifesto '07 commitment, to simplify the customs tariff, and amalgamate customs duties and stamp tax on imports."
The administration seems poised to move on that objective, likely answering the prayers of businesses now having to grapple individually with the two or three components that figure into tax calculations.
It also seems keen on transferring the point at which taxation occurs for some items, a move that on the surface may do little more than raise some revenue categories and lower others.
"The new excise tax, for instance, will now account for $234 million of total revenues in 2008/09," Ingraham said Wednesday. "Customs duties, from which a number of products were removed and placed in the new Excise Act, will now account for $516 million in revenues, as compared to $591 million in 2007/08."
Which items exactly will be moved has yet to be announced.
The measures as a whole are being billed as a way of reforming and modernizing import and in-country tax revenues and may also help pave the way for the jurisdiction to adopt a VAT or sales tax system.
The impetus for doing so may come from pending free trade deals with the U.S. and Canada that could ultimately lead to the removal of much of our import tax revenues. Switching taxation over to excise, or distribution tax, would protect some of those revenues.
"The purpose of this exercise is to follow international practice and also to remove these taxes from any reduction exercise which might be necessary as a result of admission into the World Trade Organization," said Ingraham Wednesday, alluding to his government's intention to seek membership in that trading body of nations. "Basically the sum of the present rates of customs duty and stamp duty will become the new excise rates under the new Excise Act."
Regardless of motive, Bahamian business is apt to welcome the changes, given the cumbersome math they now must apply to import items, the tax schedules of which vary widely and often without apparent explanation.
By VERNON CLEMENT JONES, Guardian Business Editor, vernon@nasguard.com
The government is keen on streamlining its tax regime, moving, said the Prime Minister yesterday, to roll duties and stamp tax into one more-easily understood import fee as well as transferring, in some cases, the point of taxation altogether.
"One year ago, in presenting my government's first budget in this term of office, I signaled (our) stand on fiscal matters, particularly on taxation," he said, as part of his Budget communication for 2008/9. "I advised of my government's intention, consistent with our Manifesto '07 commitment, to simplify the customs tariff, and amalgamate customs duties and stamp tax on imports."
The administration seems poised to move on that objective, likely answering the prayers of businesses now having to grapple individually with the two or three components that figure into tax calculations.
It also seems keen on transferring the point at which taxation occurs for some items, a move that on the surface may do little more than raise some revenue categories and lower others.
"The new excise tax, for instance, will now account for $234 million of total revenues in 2008/09," Ingraham said Wednesday. "Customs duties, from which a number of products were removed and placed in the new Excise Act, will now account for $516 million in revenues, as compared to $591 million in 2007/08."
Which items exactly will be moved has yet to be announced.
The measures as a whole are being billed as a way of reforming and modernizing import and in-country tax revenues and may also help pave the way for the jurisdiction to adopt a VAT or sales tax system.
The impetus for doing so may come from pending free trade deals with the U.S. and Canada that could ultimately lead to the removal of much of our import tax revenues. Switching taxation over to excise, or distribution tax, would protect some of those revenues.
"The purpose of this exercise is to follow international practice and also to remove these taxes from any reduction exercise which might be necessary as a result of admission into the World Trade Organization," said Ingraham Wednesday, alluding to his government's intention to seek membership in that trading body of nations. "Basically the sum of the present rates of customs duty and stamp duty will become the new excise rates under the new Excise Act."
Regardless of motive, Bahamian business is apt to welcome the changes, given the cumbersome math they now must apply to import items, the tax schedules of which vary widely and often without apparent explanation.