Bermuda’s taxi operators came in for a major 50 percent payroll tax decrease in the 2018-2019 Budget Statement, delivered in the House of Assembly, by Premier and Finance Minister David Burt on Friday.
But they will have to fork out another $1,000 with their re-licensing fees and insurance, to make up for payroll taxes many are failing to pay, to the tune of $1.2 million in unpaid taxes.
Speaking on the floor of the Lower House, Mr Burt told MPs that under the current payroll tax system, “if fully collected, the yield should have been $1.2 million”.
But he said: “This tax has been difficult to collect and last year yielded only about $350,000.
“This Government recognises the challenges faced by taxi operators; however, it is important that taxes are collected.
“Therefore, to increase the yield from this tax and make it easier to collect, we will amend the payroll tax provisions for taxi operators by implementing an annual charge of $1,000, to be paid at the time of registration.
“This fee will be borne by the taxi owner, and owners will be allowed to recoup it from taxi operators,” said Mr Burt.
“This fee represents a reduction in payroll taxes to taxi operators of at least 50 percent,” he added.
Despite Bermuda’s stagnant economy, Premier Burt said: “Currently full-time taxi operators are required to pay $2,233 in payroll taxes each year, while part-time operators are required to pay $1,118.
“Although there are in excess of 55 licensed taxis on Bermuda’s roads, he said: “There are only 411 active taxi drivers registered with the Office of the Tax Commissioner, and even fewer drivers actually file returns.”