Finance Minister Curtis Dickinson moved to set the record straight on the former government’s track record on Bermuda’s multi-billion dollar national debt.
Finance Minister on OBA Track Record on Bermuda’s Debt
News | February 25, 2019
Speaking in the House on Friday, in his first Budget Statement the Minister shut down “accusations from some channels that this Government is a ‘tax and spend Government’,” and that “increasing revenue is only being brought about by this Government and others have not raised taxes”.
“There can be nothing further from the truth,” said the Minister.
“The record will show that during its time in office, the former administration increased taxation from $866.0 million in 2013 to $1.052 billion in March
2018. This amount represents a $185.0 million (21.4%) increase.
“During this same period (2013–2017), GDP growth averaged a modest +0.1%. Therefore, the majority of this increase in taxes was from tax hikes rather than economic growth.
“Furthermore, it was the former administration’s plan to increase revenue to $1.146 billion by 2019/20 as set out in the last budget produced by the OBA in 2017/18,” he added.
He also disclosed that the former Government “refused to share” the contents of the CARTAC review of Bermuda’s tax system and its administration, completed in September of 2015.
“Many stakeholders requested access to this document, but the former Government refused to share its contents,” said Mr Dickinson.
“This (PLP) Government tabled the CARTAC review in Parliament on 6th October 2017 so that Parliamentarians and members of the community could be made aware of the recommendations.
“The report indicated that the main objective of the tax review was to increase tax revenues.
“The former Government’s preference was to increase the revenue provided by the existing taxes, although it was open to proposals that would expand the tax base and improve equity.
“The main goal of the reform was to increase revenues by about $100–$150 million over a three-year period. Thus we can see that tax reform is nothing new.
“This Government did it in a transparent manner with the publication of the Tax Reform Commission (TRC) report, while the former Government did it behind closed doors with no public scrutiny.
“I provide this information for context only.
“Honourable Members are aware that the Government released the Pre-Budget Report in advance of this budget. The Pre-Budget Report spoke of the choices we face and discussed them in the context of the risks that we face.”
Additionally, the report contains some policy options that were under consideration by the Government.
“The objective of a Pre-Budget Report is to raise awareness of the choices faced by the country and to stimulate discussion for moving forward,” the Minister added.
He reiterated that the policy options presented in the Pre-Budget Report “are just that: options”.
“As a government, we must lead, but we will always listen,” he said.
“I would like to thank all stakeholders who provided submissions during the consultative Pre-Budget process. It is an example of the approach this Government will take to ensure that we conduct our business in an open and transparent manner.”