Premier And OBA Leader On CIT, Taxes & More
Premier David Burt and OBA Leader Ben Smith have both commented on Government revenue from Corporate Income Tax and the issue of tax relief for small businesses, workers and families.
OBA Leader Ben Smith statement:
An OBA spokesperson said, “Opposition Leader, the Hon Ben Smith is pondering if Government revenue earned by Corporate Income Tax [CIT] is higher that anticipated by the Finance Minister [and Premier], the Hon David Burt, why are small business taxes being increased.”
Mr. Smith said, “The Premier previously told the people of Bermuda that Government has collected more than $1 billion in Corporate Income Tax but recently announced total revenue of $1.57 billion, almost $144 million above what was originally estimated.
“These numbers raise an obvious question,” says the Opposition Leader.
“At a time when Government revenues are reaching unprecedented levels, why did the Premier choose to double the payroll tax on small businesses and entrepreneurs [with payroll less than $200,000]?
“Bermuda should be encouraging people to work, build businesses and become entrepreneurs. With this level of revenue flowing into Government, we should be asking how we reduce the burden on Bermudians and local businesses – not where Government can find another dollar to tax.”
Mr Smith concludes: “The CIT windfall presents Bermuda with an opportunity. The priority now must be ensuring that Bermudians actually feel the benefit.”
Premier David Burt statement:
In response, Premier Burt said, “OBA leader Ben Smith has quoted the revenue figures from my statement while leaving out my clear commitment: further tax reductions and relief for Bermuda’s workers and families will be announced in November. Bermudians deserve the full picture.
“The PLP was delivering relief long before the first dollar of Corporate Income Tax was collected. In 2023, we cut payroll taxes for workers earning below $132,000, benefiting 86 per cent of the workforce. This year’s Budget delivered further cuts for every worker.
“A worker earning $48,000 now pays $120 a year in payroll tax, compared with $2,280 under the OBA in 2017. That is a 95 per cent reduction and $2,160 more in their pocket each year. That is the difference between our records.
“We have also cut private car licensing fees and, when revenues exceeded expectations, delivered a $15 million relief package: payroll tax rebates for 75 per cent of workers, help with school expenses, increased food allowances and reduced duties on essential goods.
“In 2024, stronger revenues enabled us to reduce energy taxes by 60 per cent and invest an additional $25 million in critical social needs. We have consistently ensured Bermudians share in the country’s progress.
“For businesses with annual payroll below $200,000, we reduced the employer payroll tax rate from the OBA’s 1.75 per cent to 1 per cent, nearly 43 per cent lower. That is our Budget rate. The party that charged these businesses more now wants to lecture us about tax relief.
“Corporate Income Tax revenue will support the bipartisan Tax Reform Commission’s priorities: relief for Bermudians, investment in essential services and stronger public finances, including reducing debt.
“I know families and businesses still face pressure. As our finances improve, we will deliver more relief.
“Mr Smith can try to score political points by leaving out those facts, but Bermudians know the record. We will keep putting more money back into Bermudians’ pockets. We have done it, and we will continue to do it.”
