Sections (Heads) 26 and 27 of the Recurrent Expenditure Bill in the National Budget that show our national debt and our debt payments are now gone from the 2015/2016 Budget. This means the Parliament and the public can no longer see what our various outstanding loans/debts are, how much money the government is paying on each of those loans/debts, and where existing or new loans/debts are from and are coming from. Head 26 is Public Debt Servicing Interest (meaning interest payments on our debts) and Head 27 is Public Debt Servicing Redemption (meaning loan repayments). Now that the government is taking millions in VAT money from us, it has stripped the nation of the ability to see whether a dollar of that money is going toward our national debt. Here is a link to what those standard Public Debt Documents of the Budget look like (documents from 2014 Budget).
So for those of you asking whether the VAT money is going to go to our debt – the government has now removed the information from your Budget so you can no longer see or know the answer to that question.
As for VAT – the Prime Minister said the government has collected approximately $110 million in VAT for the first three months of this year. The Budget itself says government only collected just over $74.8 million in VAT for the first three months of this year.
Also. The government claims that between January 1 and June 30 of this year, it will have collected $150 million in VAT. That’s $150 million in 6 months at a rate of 7.5%. If you stretched that 6-month trend out to 12 months, the government would collect about $300 million. But in its new 2015/2016 Budget, it says it expects to collect over $544 million in 12 months – between July 1 of this year and June 30 of next year. Now. If you were only able to get $150 million in 6 months, how do you think you are going to get over $544 million in 12 months? What that means is the government claims that between July 1 of this year and June 30 of next year, they expect to almost double the projected trend of VAT monies they will have taken from us thus far. If they think they are going to close to double the amount of money they are taking from us in VAT, then that could mean they plan to increase the VAT rate itself. If not, the government should tell us where the projected $244 million increase in trended collection is to come from. If they want to say Baha Mar, then they need to explain why no other specific resort or airlift indicators in the Budget point to the anticipation of a mega resort coming on line.
Remember – the current VAT rate is 7.5% on all the areas now being taxed. You could likely get close to almost doubling your current trend of collection at 7.5% in this upcoming Budget year by either raising the rate of VAT and potentially adding VAT to items and sectors not currently being taxed. Since the government did not announce changes to the rate of VAT or to items that attract VAT in this new Budget, and its Budget does not indicate an expectation of revenue from Baha Mar, that suggests that its $544 million VAT projection in its new Budget is either bogus, or we are about to see an increase in the VAT rate and/or more areas being charged VAT between July 1 of this year and June 30 of next year, that we have not been told about yet.