“It’s their own fault”, claims a former head of the Bahamas Chamber of Commerce in expressing his support for the government’s plan to impose a Business Licence fee on the Bahamian commercial banking sector equivalent to 3 per cent of their annual gross revenue. Also announced was a new stamp duty on profits and dividend repatriation; and fee increases phased over two years for banks and trust companies in the offshore sector.
These budgetary measures unveiled by Prime Minister Perry Christie in his 2013-2014 budget could yield between $5.04 million and $5.16 million for the Treasury from at least one Canadian bank which generated $167.91 million in interest income last year alone.
According to the government the new taxes are designed to increase the country’s tax base using the previously untaxed revenue of the Canadian banks operating in the Bahamas. Currently, the commercial banks pay no business licence fees, only asset-based fees, to the Government.
PM Christie has said that the increased revenue would help to finance the operations of Bahamian financial services regulators but this may not be enough to stop the Canadian ‘snow-birds’ from heading due south for the winter.