Govt: No Decision Made On Proposed Rental Tax

February 8, 2019 | 31 Comments

[Updated] Due to a number of people contacting Consumer Affairs saying that their landlord informed them “their rent will be increased due to the new tax,” the Government noted that while the proposal was contained in the Pre-Budget Report “no decision has been made by the Government to implement it at this time.”

The Government’s Pre-Budget report said that “in order to broaden the tax base” they are considering taxing rents in line with the recommendation in Tax Reform Committee report, which suggested a flat tax of 5% on all commercial rental units and individual rental units with an ARV over $22,000.

A Government spokesperson said, “Consumer Affairs has received several telephone calls from concerned members of the public over the past few days regarding the proposed rental tax cited by the Minister of Finance during his Pre-Budget Report.

“The Ministry of Finance and the Ministry of Home Affairs wish to clarify several points. Firstly, residential units that fall under Rent Control [with an ARV of $22,800 or less] would not be impacted by the proposed tax.

“Secondly – and perhaps most importantly – the rental tax was only a proposal that was being considered as part of the pre-Budget consultation process. The Government has not announced a decision on this yet and will not do so until the Budget is read on February 22.”

“The proposed rental tax was simply a recommendation of the Tax Commission that was added to the Pre-Budget Report, along with other tax proposals.

“It was included in order to extract public feedback, which we have been pleased to receive. It should be stressed that no decision has been made by the Government to implement it at this time.

“This clarification is provided in response to phone calls to Consumer Affairs from tenants reporting that their landlord has informed them that their rent will be increased ‘due to the new tax’ as of March 1st.

“Consumer Affairs has addressed this behavior with the offending landlords. It should be noted that if Consumer Affairs receives a report of any effort by a landlord to impose an increase on a tenant related to the proposed tax, it will be swiftly investigated.

“If a landlord is found to be doing this, then such actions would be classed as “a false, misleading or deceptive consumer representation” under the Consumer Protection Act 1999 Part III Clause 11.

“If members of the public wish to find information regarding rent control, they can go to: www.landvaluation.bm.”

Update 4.18pm: According to an tweet from Age Concern — which had previously expressed concern about the proposed tax’s impact on seniors — the Minister announced on the radio that residential tax proposal is ‘off the table.’

They tweeted, “Congratulations to Finance Minister The Hon. Curtis Dickinson who stated on Magic 102.7 Sherry J show “Rental Tax……… off the table.” UPDATE: Residential Tax Proposal.”

We asked the Minister’s office for comment and will update if they respond.

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Comments (31)

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  1. Kevin says:

    And the PLP are surprised of this action ……….shows you how smart they really are
    Ray Charles could have seen that coming

    • Its a good thing we have open cunsultation, unlike those other dreamers who rammed everything down your throat. Thats why they got voted out.
      And the greedy landlords are jumping de gun and it was just a proposal.
      Um, you do know what a proposal is do you?

      • Onion Juicer says:

        Sorry to ruin your dedication to your favourite cult but the OBA did have many public consultations but most of them were hijacked by your fellow cult members. Remember No No No? I know because I was at some of them. Ironically the people who did a lot of that shouting at thos meeting are now about to be hit with higher taxes…..karma

    • Scientist says:

      The PLP will listen to the people!!!

      Your circus changing name oba/UBP didn’t and that’s why you got beat 25 PLP – 11 oba/UBP. Now find another leader after the next election or change the name again LOLOLOL

      I see you failing again.

      • Jus' Wonderin' says:

        You won’t be laughing when the whole island fails again ya dummy and ya won’t be able to pay ya rent lmfao…enjoy that!

        • Scientist says:

          You find another leader yet dummmmy lolol. I hear they looking already LMAO

        • De Boogieman tactics are played out. Just because ya supporters and business croonies can effect the economic status, you want to abuse your propaganda platform.

          • Question says:

            With 25-11 he thinks he can put things through that 84% of people don’t want.
            They want to tax ordinary people their hard earned money so they can travel and buy themselves cars.

          • Onion Juicer says:

            Does your Mommy know your using her computer again? Isn’t it bedtime soon?

  2. Proven says:

    Where is a real plan for growth? We cannot tax our way out of debt. Cut the civil service for starters.

  3. Joe Bloggs says:

    I predicted in another comment that this was all hype and the Government would do the “responsible” thing and not introduce this tax. A shrewd political move by the PLP government

    • question says:

      They are amateurs. Throwing mud at walls and hoping something sticks.

    • Toodle-oo says:

      Exactly what I’ve thought from the beginning. Propose something that’s so outrageous it pisses off everyone. Either way the plp can’t lose. They introduce it and they’ll still get voted back in . Cancel the idea saying that they’re a listening and caring government and they still get voted back in !

    • Sandgrownan says:

      Shrewd? Clueless would be more appropriate

  4. JohnnyB says:

    This is the worst government in the history of governments PERIOD.

    Where is BURTCOIN? He is like the Houdini of leaders, he randomly comes out to shout Fintech then disappears into the night.

  5. Smiths says:

    watch out for the following: increase in sugar tax….new tax on interest/dividends (yes a tax on your measly $5.00 interest per year savings account(then a bank fee increase to do the extra tax/interest calculation), new services tax (insurance and legal), increase on your cell phone tax..alcohol tax increase and increase of all government services 5% across the board.

    • PBanks says:

      FCPT increase is in the cards, and yes more sugar tax. Probably come up with a plastic bags/cutlery one sooner or later. Departure tax?

      • Joe Bloggs says:

        Just to be clear, an increase in FCPT = devaluation of the Bermuda dollar against the US dollar in economic term (if not in political terms)

  6. Jt says:

    Once a tax is applied a landlord can increase rent because of the new tax. Nothing government or consumer affairs can do about it unless the property is under rent control.

  7. question says:

    I just read that Dickinson is saying any landlord who passes on the increase will be ‘investigated’.
    Is he insane?

    • Jt says:

      I think he means using a tax increase to justify a rent increase prior to a tax actually being passed. Claiming it would be misleading representation. Likely true.
      However, once a tax is actually instituted there is nothing government can do to prevent an associated increase in rent if that’s what a landlord chooses to do. (Unless the property s under rent control).

  8. Y-Gurl says:

    The pot is yet again empty so here we are looking at anyway possible to squeeze the last dollar from us, fact is landlords are only going to pass any tax onto the renters further stressing them, I agree with Proven, get rid of some of the massive and ineffective civil service with “jobs for life” we should also look at privatization of certain areas of the service sections. Sorry PLP you certainly don’t get my vote on taxing rentals

  9. wahoo says:

    So how are we going to raise the money that is needed? The minister will need his own version of America’s Cup to stimulate the economy. Sad state he finds himself in trying to fix a broken economy – bitcoins and fintech ain’t happenin’. Maybe the junior minister has some good idears for Bermuder.

  10. Third Star To The Right says:

    A Bermudian born in 1931 would have been 44 yrs old when the contributions to the public pension system began in 1975. That same person – having worked until retirement – would have retired in 1996 receiving full benefits, but having paid into the pension system for only 21 years. If that person is still alive (and many many are!) they would be 87 yrs old and would have received 22 years of Govt pension benefits including “cost of living increases”!!! Many in this generation did not even pay in to the system for the full 21 years!! And here we are in 2019 giving them cheques every month with out fail, and meanwhile they own 3 apartments (or more) paying them 6,000 per month…..and refuse to pay a dime toward their own welfare. But will take that cruise to Europe every year! Pay your rental taxes and stop being so cheap!!

  11. Onion Juicer says:

    This Government is so clueless. It hasn’t even been two years since the election a Bermuda is in a nose dive with no hope on the horizon. Good thing Dr. Brown got his $1.2 Million though

  12. Big Dipper says:

    Lazy greedy rent collectors don’t want to have to pay their fair share!! Most have not even paid into the pensions system more than 20 years but have already collected 20 years of increasing benefits!! Pay your taxes landlords!! PLP is WEAK.

  13. 5% says:

    This behaviour?
    If tax on food or refrigerant goes up then food does have to follow, sorry but all costs of any and all from groceries to medical care ,to the shoes on your feet ,the clothes on your back, insurance etc…they are “all” reflective of the taxes imposed onnit.
    It is just business.
    If it it is not profitable to rent then units will be removed from market entirely .
    Why rent a unit when our behaviours are offensive?
    I’m offended the unit has 50% less trash pick up …yes …it is offensive the roadways are blocked with trash once a week and you have to wait for the road to clear to go anywhere ..by the way …this creates an emergency services access problem too and is definitively unlawful!
    Then you cannot travel to or from said unit due to lack of public transportation.These items are part of the usage structure that is basis for other taxes…when you remove them you reduce the right to charge tax on other items as they are related and intertwined. No it is not deceptive at all…it is honest and open….all tax is passed on to consumers…that is why you have 100,000 dollar vehicles etc….
    Now apparently were offenders and our behaviours are being rigorously investigated…..hey stupid We are not going into the red to offer residences …because you cannot spend less than you make?
    It is not your money in the first place…it is taxpayers money…and we are offended ,,,you do not have an overdraft facility with tax dollar…it is your spending.
    The only way you can brauden your tax base is to legalise marijuanna.

  14. 5% says:

    All cost incurred is relative to overall cost of rental.You indicate this is off the boards…then you say no decision has been made…then you indicate that landlords are being deceptive by timely informing tennents of a new tax effecting (directly) cost.I can assure you of one thing rental units are definitely going to be removed from market…Hey plp…put your hands back in your own pockets or …or stop your spending habits …they are really effecting the people quite badly.

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