Bahamas – Make Sure You Know Who Should Be Charging You VAT And Who Should Not As Of January 1

VATINFOThe government is required by law (the VAT Act) to generate and publish a list of all businesses that have registered for VAT, and this list by law must be kept current and made readily accessible to the public at all times. This list lets you know which businesses should be charging VAT. When a business is registered, it is to charge you 7.5% VAT on all goods and relevant services which it must turn over to the government in full. If a business is not registered but it is charging you VAT, that means it would be collecting that extra tax money from you with no arrangement to turn that money over to the government (and it can then just pocket the money if it chooses to). IN OTHER WORDS, IF A BUSINESS IS NOT REGISTERED FOR VAT, IT SHOULD NOT BE CHARGING YOU VAT. Here is the link on the Government’s Official Website to the list of businesses that have registered thus far.

As for price control and price increases, I, as a consumer, have concerns about the way the government wants VAT to be charged on goods, which is that instead of simply charging 7.5% at the register on the total cost of everything you buy, the 7.5% is to be added into the cost of an individual item itself. Not every business is honest and moreover, VAT is a relatively complicated tax. Unless you track the cost of every single item in a store before January 1 and then go back and check the price of every single item after January 1, how do you know that the increase won’t be more than 7.5%? How do you know that businesses won’t use VAT to hike prices over and above the government’s 7.5% tax? Who is going to be the watchdog for consumers with this new tax?

And also, based on expenses that businesses will incur because of VAT, is it really realistic to think that we will see prices go up by ONLY 7.5% anyway? Is it not reasonable to think that some businesses will pass their additional costs onto consumers on top of the 7.5% at point-of-sale that must go to the government? It will be very interesting to see how this turns out business-to-business, and whether 7.5% will only be the tip of the iceberg in overall cost increases coming in a few weeks time. For services that are designated as VAT exempt like “education” (tuition/school fees), check with your schools if you see them on this list as being registered to charge VAT, so you can find out what you will have to pay VAT on at schools as of January 1.

NEED TO SEE THE VAT LAW? CLICK HERE – VAT ACT 2014

NEED TO KNOW WHICH SERVICES AND IMPORTS ARE VAT EXEMPT? CLICK HERE

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