some are facing closure.

One leading retailer called for cuts in Customs duty paid by merchants for imports.

In the wake of sluggish Christmas sales, Mr. Eldon Trimingham said steep taxes made it hard for local merchants to compete with American rivals.

"We need to be able to operate on an even playing field,'' said the Bank of Bermuda chairman and president of Trimingham Brothers.

"I think Government has got to recognise the world is changing and becoming more competitive and that our tourists have a wider selection of places to go.

"I would have thought we need the removal of duty on certain classifications of merchandise.'' His comments came as retailers predicted little -- or no -- improvement on last year's sales. Part of the blame was pinned on bad weather.

Mr. Eddie DeMello, owner of The Music Box in Reid Street, understood several smaller businesses were on the verge of collapse.

"I think some businesses will just pack up in 1996. There are rumours that some people are just not making enough money and will fold.'' Store managers were banking on a surge of shoppers in the two days before Christmas Day to boost figures.

Some were hoping to maintain the late momentum by tempting bargain-hunters with Christmas sales, which started this week.

A.S. Cooper & Sons threw open their doors on Wednesday for a "grand storewide sale''.

Shoppers flooded the store, lured by the prospect of saving up to 50 percent on some items.

Managing director Mr. Peter Cooper said he was delighted by the response.

"We've been extremely busy, particularly in the ladies' department.'' Other major stores, such as Trimingham's, Smith's and Gibbons Company, started their sales yesterday, with matching price reductions.

In December 1994, retail sales increased marginally over the same period in 1993.

Bermudians dug a little deeper into their pockets over Christmas with gross revenue in the retail sector increasing 5.1 per cent, while those travelling home from trips overseas declared purchases worth $3.38 million.

This was an increase of 11.2 per cent over the previous year.

In a bid to boost sales, the Chamber of Commerce kicked off this year's Christmas shopping season with an annual festival which saw downtown Hamilton stores opening late.

According to the Chamber, the days between US Thanksgiving and Christmas can generate 25 to 35 percent of a Bermuda store's receipts.

And in America some retailers grab up to 40 percent of their sales during that time.

Chamber of Commerce president Mr. Robert Rego believed this year's seasonal jingle of cash tills would be flatter than 1994 -- although final figures had not yet been compiled.

"At this stage there's a possibility of getting close to the figures of last year,'' he said.

"I don't think we will match the figures, although they will be more respectable than what they could have been. We are very appreciative of the support from locals.'' Mr. Rego added: "The last two days before Christmas seemed to be very positive.

"There was a lot of activity on the Friday and Saturday and retailers were very pleased. It made up for losses early on in the week.'' While the late flurry of shoppers was welcome, retailers agreed it failed to compensate for the downturn earlier on in the year.

H.A.& E. Smith president Mr. Roger Davidson said the weather had deterred Christmas shoppers.

"The wind and rain discouraged people from coming into town, and I'm sure they didn't help tourist figures.'' Mr. Davidson detected a late sales boost at his store which could see Christmas 1995 slightly overhaul last year's performance.

He added, however: "It's nothing we want to bring out the brass band over, although any increase is a good thing.'' Mr. Davidson believed duty reductions could be part of the solution to revitalising the retail industry, although he understood Government's need to find revenue.

"In 1996 things have to be improved in the industry. I am guardedly optimistic this will happen.'' Mr. Cooper described sales in the early part of December as "soft''.

"The last two days before Christmas were extremely busy, although it didn't make up for the earlier part of the year.

"There was one day leading up to Christmas when the weather was really dismal.

"It was terrible and everybody stayed home. I think that could explain why so many came out on Friday and Saturday before Christmas Day.'' Mr. Cooper believed his store would do marginally better than last year.

"I stress the word marginally, because our industry is not out of the woods yet.

"The real challenge lies ahead and how we perform in January, February and March.'' Mr. Cooper said he welcomed Opposition Progressive Labour Party Leader Mr.

Frederick Wade's support for merchants.

He described Mr. Wade's call for a review of the tax system -- and a reduction in Customs tariffs -- as "music to my ears''.

Mr. Trimingham believed this year's season could well be flatter than Christmas 1994. And he was not surprised.

He went on to point a finger at duties on merchandise paid "up front'' by retailers.

This tended to push up prices in Bermuda for certain goods.

"It leads to a perception that things are more expensive here, and, therefore, we are at a competitive disadvantage.

"Sometimes it is just a perception that things are more expensive, sometimes it is a reality.''