Wednesday, February 9, 2011

Baha Mar Strikes Tax Deal


By IANTHIA SMITH

Prime Minister Hubert Ingraham (Journal File Photo)

Prime Minister Hubert Ingraham announced in the House of Assembly Monday that executives of the proposed Baha Mar mega resort have concluded all of the necessary steps to enable them to begin the actual redevelopment of, what he calls "an important and historic area in the Bahamian tourism establishment."

Prime Minister Hubert Ingraham announced in the House of Assembly Monday that executives of the proposed Baha Mar mega resort have concluded all of the necessary steps to enable them to begin the actual redevelopment of, what he calls "an important and historic area in the Bahamian tourism establishment."

It was indeed a long time coming, but after years of negotiations, political and public debates, the $2.6 billion dollar Baha Mar project is now just weeks away from getting off the ground.

In Parliament Monday morning, Prime Minister Ingraham tabled the documents proving that it is now official – seven novated and amended agreements.

The prime minister also announced that Baha Mar has settled much of its debts by paying off some hefty bills – including its real property taxes.

"Baha Mar has now paid $8.3 million in outstanding taxes," he said. "Further, stamp duty of approximately $27 million has been paid by Baha Mar in connection with it financing arrangement.

"BEC has been paid the $8.5 million due to the corporation."

The prime minister said the government has agreed that the $10.75 million in casino taxes owed and deferred will be paid upon the opening of the proposed new casino.

He said additional sums will become payable to the government upon the transfer of the Commonwealth Bank and Fidelity Bank premises.

But Mr. Ingraham added that the government is on tap to get even more money from Baha Mar.

"I advise also, that the China State Construction and Engineering Company will be required to pay the usual sums payable by non-Bahamian companies in respect of projects undertaken in The Bahamas," he explained. "That is a fee of one-and-a-half per cent of the contract value, which as I understand is a value of $1.9 billion or thereabouts."

The prime minister said Baha Mar has come through all its paces by "a spirit of dogged determination and a clear sense of purpose, which should bode well for its prospects and future."

"What my government has sought to do in its negotiations with Baha Mar was to ensure that the widest possible opportunities will be available to Bahamian entrepreneurs to benefit directly and indirectly from the realisation of the long deferred dream for a redeveloped Cable Beach Resort area," he added.

In a press statement released yesterday, the Opposition patted itself on the back for holding the government to its guns.

The Progressive Liberal Party (PLP) said the prime minister’s communication should serves as a lesson to him "of what can be accomplished when we stop playing politics with people’s lives and button down and work in the interest of our people".

"It also shows what being a diligent and hardworking Opposition can produce. There is no doubt that the Baha Mar project which was left in place by the PLP is good for The Bahamas, in spite of the prime minister’s unfortunate negative comments, delays and non-involvement during negotiations with the Chinese Import/Export Bank," the party said.

"It is long overdue and we are only at this point because after years of stall, delay and defer by the prime minister, he was forced to recognise that what was left by the PLP was good for the country. Indeed, the prime minister is now boasting of the project as if it were his own.

"We will continue to monitor all that has been promised to ensure that the promises of both the government and the developer are kept. We are equally concerned about the maximum participation of Bahamian contractors of all classes, not just the traditionally favoured few and that the project itself adequately prepares for the hiring of Bahamians when it is finished and complete."

Groundbreaking on the multi-billion dollar development is slated for February 21.


Source: The Bahama Journal - Bahamas News Online

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