Rick Lowe
Mr. James Smith, former central bank governor and finance minister told The Tribune Business on December 3, 2009 that The Bahamas needs to restructure the tax system and move away from excise or import tax to a Value Added Tax regime. [More...]
He spoke about a 'lack of revenue buoyancy' which in layman's terms means government revenue cannot support the current level of expenditures.
However, what we know is government has been consistently running deficits for decades now, so what makes Mr. Smith believe with more revenue, deficits will cease?
I will be willing to bet that more government revenue would just mean more government spending.
What I do not understand though is there was apparently no discussion of the need to reduce government spending in line with revenue levels.
H.L. Mencken said:
"Taxation, for example, is eternally lively; it concerns nine-tenths of us more directly than either smallpox or golf, and has just as much drama in it; moreover, it has been mellowed and made gay by as many gaudy, preposterous theories."
And the "preposterous theory" in this story is the apparent belief that if the government just gets a more revenue, everything will be okay.
Sometimes the government should lead by example and this is one time they should cut the cloth to fit the suit.
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