Bahamas, June 22, 2017 – Nassau – Minister of Finance, K Peter Turnquest and the Minnis-led administration wants to move away from the ‘protectionist policies’ but have gone ahead with reversing their decision to reduce duties on paint and fruit drinks.
The decision comes after criticism of the FNM’s proposed tax reductions from local manufactures as well as from the official opposition, The Progressive Liberal Party (PLP). PLP parliamentarians had suggested that some of the tax reductions proposed by the new administration harmed Bahamian manufactures but benefited families of members of the governing side; while manufacturers argued that it would make it cheaper to buy drinks from abroad, than from at home if the duty was too low, thus making it harder for them to sell their products.
The customs duty on paint will now be 45 per cent while the duty rate on fruit drinks will be reduced from 60 per cent to 30 per cent.
Deputy Prime Minister Turnquest confirmed to Tribune 242 that representations were made to him by manufacturers of those products, prompting the reversal. “Our first priority is to Bahamian manufacturers and we don’t want to take action harmful to their benefit.”
The Finance Minister however cautioned that, “As we move forward to improve cross border trade we will have to address these protectionist policies and again the whole idea of value added tax (VAT) initially was to introduce that and be able to reduce border taxes so there is free and open trade,” he said. “As a developing country, it is important that we have that.”