A governing party insider
was boasting in the press recently that The Bahamas has no trouble
obtaining more debt by floating bonds either here at home or abroad,
using them to make good on the country's payment obligations. i.e.
borrowing more money to pay existing debt obligations, increasing the
national debt each time. This
curious public policy is continued in the face of four decades of
spending more than the government takes in and borrowing to cover the
shortfalls, the burgeoning and expensive public bureaucracy and wonton
waste.
Successive
governments share the responsibility of increasing the country's debt
that has now caused their fiscal dilemma, with average deficits of $165
million a year from 1991 through 2012*. (That's $3.6 Billion if you're
counting).
Yet,
so far, the only answer to solve the government's fiscal problems is to
implement a new tax scheme (VAT), not collect the taxes already allowed
by law nor control their profligate spending or implement policies that
will help the economy grow.
To paraphrase Winston Churchill, we cannot expect to tax the economy into growth and prosperity. If history is used as a guide, increasing the tax burden will probably slow the economy even more. What then?
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TheBahamasWeekly.com