The number of retailers demanding Government scrap Customs duties in favour of sales tax is growing, said Eldon Trimingham, Bank of Bermuda chairman and president of Trimingham Brothers, yesterday.

"I'm not sure that some people really understand the seriousness of the situation. The number of retailers in our group (comprising Hamilton, St.

George's, Somerset and Dockyard retailers) has grown pretty large,'' he said.

"We have to make these changes fast, because tourism is falling too quickly.

Duty has to be removed before people start importing for the next season,'' he warned. "If the Minister doesn't announce a change before the next Budget, then we will waste an entire year.'' But Finance Minister Grant Gibbons threw cold water on drastic measures, saying, "We haven't closed our mind to it and we may, after the ongoing discussions, carry out a more formal review of some of the options, as we have with land tax and other matters.

"But it is appropriate to review taxation in a careful, thoughtful way, because the benefits and the costs of change need to be shared by all Bermudians and not just a special interest, or narrow industry group.'' And he suggested retailers could offer lower prices if they stopped marking up their prices over costs that included duty.

"We need to be aware that a good many retailers mark up the customs duty, putting a profit on top of their customs duty, which we've noticed is beyond that which could be rationalised on the basis of the service costs or shrinkage,'' said Dr. Gibbons.

"So retailers right now could in many respects reduce the mark-up on the customs duty, in the price of the goods and take their prices down quite a bit.'' Mr. Trimingham countered, "You must mark the duty up in order to pay for it.

You have to finance the cost of giving that money away to the Government before, sometimes long before if at all, you receive any money coming in for that product.

"For just one retailer, tax expenses -- not the tax itself but the cost of financing the tax -- added up to $724,216 in just 1995. That's the cost of having to pay taxes up front.

"We have to put up huge sums of money just to get a container off the dock.

It's an immense amount of money and is all paperwork and time.'' The retailers are running a series of advertisements in the newspaper, printing statistics relevant to the ailing retail industry and suggesting ways Government could ease the tax burden on retailers by seeking other sources of revenue.

Scrapping duties for sales tax, they said, would allow Bermuda to bill itself a duty-free port.

Mr. Trimingham said, "We could change Bermuda's image from being an over-priced, dowdy destination to a vibrant one by allowing this huge segment of the tourism industry to freshen and brighten up, modernise and do all the things we need to do to compete in the modern world.

"There are a lot of people involved in this. People are ringing up, wanting to contribute to the payment for the advertisements.'' Retailers From Page 1 "There are a lot of retailers out there who know that we are taxing our tourist business, including our retailers, out of business,'' he said.

But Dr. Gibbons pointed out eliminating the duty on china had not increased china sales, nor had cutting the duty on perfume increased perfume sales.

And he said most tourist complaints about retail shops were directed at service, not prices. Restaurants and transportation bore the brunt of price complaints, he said.