In recent weeks our people have been met with two historic pronouncements from the Government. Each one would have been deserving of some consultation with the constituencies they allegedly represent before embarking on our quasi-commitment. I speak of the historic Corporate Income Tax Act 2023 now sitting before Parliament and full membership in Caricom.

Given another time and perhaps another party, the voter could be excused for thinking that such lack of consultation and/or answers would be considered arrogant behaviour on behalf of the Government to proceed in such a manner.

In no order of importance — as both, if enacted, would have significant consequences concerning our cultural, economic and financial wellbeing going forward — I would like to address the elephants in the room. Your newspaper described as “historic” the Corporate Income Tax Act 2023, which will impose a 15 per cent tax on Bermuda business’s part of multinational groups. For the moment, the targets are those companies with declared revenues of €750 million (about $808 million) or more.

The Government is not clear on how many of those companies doing business in Bermuda would be involved, and when asked to comment according to Hansard, the reply from the Minister of Finance was a curt “No”.

Not all that reassuring, really. This erratic action by the Government is reminiscent of the explanation given after Christopher Columbus returned from his first attempt at finding a new route to the Indies. “Christopher Columbus was the best dealmaker in history. He left not knowing where he was going, and upon arriving, not knowing where he was. He returned not knowing where he had been and did it all on borrowed money.”

For a legislative body to introduce and pass such historic legislation with so many unanswered questions as to the consequences only begs suspicion from the voters: exactly what is the hurry here? How does it make sense to be guided by a foreign entity to dictate your future revenue structure? Why is the Bermuda Government trying at breakneck speed to be first to sign up? Given that our largest trading partner is somewhat lukewarm to the position on global taxation taken by the Organisation for Economic Co-operation and Development. Is this not the same government that bristled at Britain for allegedly usurping the supremacy of our local parliament recently? Yet seemingly it has rolled over without uttering a word of defence for a revenue (tax) and expense system that has served the Government of Bermuda for these many years. A system which, by the way, included a commitment as to the corporate-tax obligations of these same companies until 2035.

The promise of the Premier and Minister of Finance that enactment of the provisions of the Corporate Income Tax Act would “... present an opportunity for Bermuda to chart a path towards meaningful tax reform that will significantly reduce the cost of living and the cost of doing business in this country, leading to further economic prosperity and economic stability” must be taken with a great deal of suspicion.

Given the record of handling taxation policies of the past 40 years by succeeding governments, one is quickly reminded of the American humorist who advocated that he never knew of a politician who met a tax they didn’t like!

To jog one’s memory, the hotel occupancy tax was introduced at a quarter of 1 per cent, the proceeds of which then were to pay for the hotel training facilities at the yet-to-be-built Bermuda College. Today, the tax has morphed to 11.25 per cent for which the Bermuda Tourism Authority and the Consolidated Fund are the beneficiaries. This includes the infamous sugar tax, whose proceeds were to be for the benefit of future health costs and education of healthier living, land tax, customs duties, stamp duties, payroll tax, as well as a myriad of fees covering transportation to company incorporations and beyond, with the collected revenues of same being lost in the empty pot called the Consolidated Fund. There is nothing in the legislation that would give one the impression or direction that revenue from corporate income tax would be handled any differently.

It would be an easy and important amendment to have a clause as to the purpose for such revenues raised by the Act. As an example, to be segregated and used to, say, make provision for the paying down of the Government’s national debt — which sits between $3.5 billion and $7.2 billion, and whose balance fluctuates depending on what you include or keep out. What is sure is that the approximately $150 million annually spent in interest payments is a considerable stagnant force on any real progress in government programmes, be they social or infrastructural. While the debt is not the only elephant in the room, it is certainly the largest and does considerably obstruct the view of the future for our island.

Lastly, but by no means least on this subject, is the administration of such a policy of corporate taxation. The Government’s administrative cost of revenue collection is about 60 cents for every dollar collected. In other words, it cost the taxpayer a dollar of tax, but the actual benefit rendered is worth 40 cents. The 60 cents is the wages, salaries, pensions, benefits, office and other administrative costs required to produce the 40 cents of services. Pretty appalling, really. According to recent reports, we really have no idea, either, of how much the Government will collect from the new tax or — and just as important to know — how much it will cost to collect! That information allegedly will come from the Tax Reform Commission, according to the finance minister.

So, as no one would doubt the moniker of “historic”, there remain many outstanding basic questions that, for the moment, our government would like us to have faith in and follow blindly. However, it is the Government’s past and present record in such matters as revenue raising, collection and accounting that sends tremors through the voters. The recent activity by a non-debt collection entity hired to collect land tax is only one recent example of such administrative missteps, resulting in millions of dollars being unnecessarily spent.

Caricom

I will turn momentarily to the proposal of full membership in Caricom recently floated by Cabinet to the House of Assembly for consideration. After some 20 years as an associate member, one would have thought that a quick, forthright and rather convincing set of reasons would be presented to the people of Bermuda from the Government. Given that such a thought appears to have been conceived within the halls of Cabinet, as there has certainly been no hue and cry from the public one way or another. In fact, it is probably fair to say when one looks at present concerns in the minds of our people, Caricom not even on the radar — regardless of our membership status. The economy, education, healthcare/senior care and food costs are most certainly the “kitchen table issues” that consume the day-to-day thoughts of our people. Our membership in Caricom, historically and most probably into the future, has had nothing to do with finding solutions for these concerns.

It is not unreasonable for anyone to think, “OK, you have an idea, so let me hear your reasons as to why you think it important for consideration.” Instead, what we get is a diatribe of condescending retorts to those who may question the validity of such considerations and a diminution of the experienced voices within our community who have concerns. As if it is a popularity contest within a sorority.

I have on occasion opined that governments in general float these controversial balloons as a way of redirecting attention from what may be a dismal record of accomplishments they don’t wish the voting public to spend to much time on. The tried-and-true perennial issue of independence is always a good source for distraction from other realities. When all else fails, a feigned attempt at being personally insulted gets thrown in for good theatre.

Once again, we are left begging for reasons and valuations as to why the Government considers such a move as worthwhile. And how is a dearth of what should be readily available information, along with its proposal for full membership, an example of much touted transparency. As this issue unfolds, the lack of forthright explanation as to its value only seeds the premise that it is yet again another ill-floated balloon commissioned to cause deflection of other issues before us.

“Come see us in February when we have thought up some reasons” is not a convincing argument. Attempting to satisfy concerns by advocating that “we don’t have to accept all the same conditions as other members” is at best raising suspicions as to what advantage is that over existing associate status.

Well, it has gone quiet, so perhaps the goal of diversion was achieved. Either way, it has been yet another example of half-baked ideas from the Government with an ever-increasing dissatisfaction level among the people. We will all need to be extra-vigilant as the election season ramps up and the candidates once again, or not, will be on our doorsteps with more promises of what they could do for us.

Perhaps it should be met by the voter’s response: “What have you done for me lately?”

• David J. Sullivan was an independent candidate in the 2011 by-election for Devonshire South Central