As a result of the Hope Town District Council’s initiative, government is about to make a significant change to benefit local government, one of only two major changes since the system was initiated in 1996. The Local Government Act has been amended to allow district councils to collect real property tax on behalf of The Treasury.
Prime Minister Perry Christie has made several references to this change, and the amendment to the Local Government Act has recently been passed by Parliament. Working details have not been released, but the Hope Town District Chief Councillor, Jeremy Sweeting, expects it to be implemented by October.
Although details have not been released, the district council collecting the property tax will keep a fixed percentage for capital projects within its district. Numbers have not been given, but it is hoped that this may be in the five to ten percent range.
Although this change was instigated by the Hope Town District Council, it will affect all local government districts in the country.
Chief Councillor Jeremy Sweeting has been in phone and personal consultation with government and Treasury officials since 2012 on this topic. In 2009 he attended a local government seminar in Freeport and later in 2011 he went to another conference in Trinidad. During both these sessions he learned of local government policies worldwide.
Speaking with Members of Parliament as opportunities presented themselves, he began his one-man lobbying campaign to allow local tax collection. He was very convincing explaining that local officials could do a better job and that the Treasury would see an increase in tax revenue. Many officials encouraged him and felt that his plan had merit.
In January of this year Mr. Sweeting was invited to discuss his plan with treasury officials. On February 12, a six-person delegation from Hope Town met with Treasury officials to discuss the concept further. Nassau was not caught off-guard as Mr. Sweeting had earlier sent a written proposal for them to consider. The delegation was warmly met by five or six senior Treasury personnel.
The basis of Hope Town’s argument was that persons with local interest and knowledge were better qualified to see that property taxes were up to date. The delegation believed that taxes collected locally would exceed the amount now collected by Nassau.
Making the one-day trip for the meeting in the Prime Minister’s office were Chief Councillor Jeremy Sweeting, Council member Don Cash and Council secretary Marjorie Chapman. Also attending were three persons from real estate and property management companies who were intimately familiar with the area’s foreign-owned properties. These were Kerry Sullivan, Carrie Cash and Lori Schreiner. Abaco’s Senator Gary Sawyer met the group in Nassau and attended the meeting.
Bahamian-owned properties in the Family Islands are exempt from paying property tax.
Chief Councillor Sweeting emphasized that this is not a punitive exercise but feels that over the years many property values have not reflected improvements or been realistic in assessed value. Furthermore, he is optimistic that a percentage of the amount collected will remain with the Council for funding capital requirements.
Originally, the Local Government Act provided for a percentage of property taxes to be made available to local districts. However, this aspect was not put into effect when local government was instigated.
This is government’s first significant positive change to the local government system implemented in 1996. However, it follows local government practices in most areas of the world. Only 19 years old, our local government is probably the youngest in the world. Other countries such as England, Jamaica and New Zealand have practiced comprehensive local government management for 200 or more years. As our system matures, we can expect to see many changes.
An earlier significant change removed the licensing process from local government leaving all licensing decisions with a person appointed by central government. Bars, liquor stores and some businesses approved by this new system were felt by the affected communities to be inappropriate for the chosen location. Local Government and affected residents felt this new system was detrimental to some communities.
Changes to the local government system will be slow due to the natural reluctance of politicians to cede their authority over local matters.
Further hurdles to change relate to The Bahamas’ scattered archipelagic geography and the varied nature of the different islands’ social and economic development.
The Hope Town District includes the three major islands of Elbow Cay, Man-O-War Cay and Guana Cay. Additionally, the district includes the lesser developed islands of Lubbers Quarters, Scotland Cay, Tilloo Cay, Lynyard Cay and many privately owned islands stretching from Bridges Cay in the south to Foots Cay in the north.