by Owain Johnston-Barnes
The Government announced plans to revitalise Morgan’s Point and reform the island’s payroll tax system in its annual budget.
David Burt, the Premier and Minister of Finance, announced in the Budget Statement that the tax brackets would be redrawn to add a fifth band and offer tax reductions to 86 per cent of the workforce.
The Premier also unveiled plans to convert the failed hotel project at Morgan’s Point into a residential development with a restaurant and retail complex.
The first phase of the project was estimated to cost $130 million, which would be backed “either by security of the property or sovereign guarantee, thus minimising interest costs”.
He said: “We have targeted this mixed-use site for the development of a range of residential rental apartments, including a component for seniors housing, with an active and engaging amenities district filled with commercial retail and restaurant opportunities at its centre.
“To be clear, the newly proposed Morgan’s Point Project will not be operated as a gated community, and the amenities district will be open to all Bermuda residents.
“The new enterprise will not only put the site into productive use, but will also address several longstanding key goals of this government regarding economic stimulus and increasing housing supply. At the centre of the redevelopment plan is the concept of Live, Work, Play — all on site.”
The Premier said that the operation would generate cash returns to “more than cover the costs of construction” so that Bermuda can recoup funds that were paid out for the $165 million guarantee agreed by the One Bermuda Alliance for the previous plan for a hotel at the site.
Mr Burt told MPs he could have balanced the Budget in the present fiscal year, but insisted the island need to move forward on infrastructure and covering hospital finances.
He pledged infrastructure investments to come and said projected capital expenditure for 2023-24 was $96 million — 31 per cent more than the 2022-23 original estimate and the “highest budgeted capital spending in 13 years”.
Delayed projects on infrastructure will move ahead in 2023-24, with the Premier saying waiting longer risked “catastrophic” failures.
He added that the new Budget “will do more for public education” as well as supporting the advancement of workers’ rights, and said the island was still on track for a balanced budget in 2024-25.
Mr Burt said there would be an announcement coming in the third quarter of the year on creating “a world-class medical tourism facility” in Bermuda and confidence was “high” that work on the Fairmont Southampton would begin in the second quarter.
Meanwhile, Cole Simons, leader of the One Bermuda Alliance, said in the party’s official response that if the party were in power, it would suspend Bermuda’s foreign currency purchase tax and consider introducing a “minimal VAT tax on healthcare services”.
Mr Simons said that “sin taxes” on cigarettes and spirits needed to be reassessed and that the OBA would “reduce the size of the government through offering early retirement and through attrition”.
However, his statement was overshadowed in headlines by a comment that the OBA would bring back the unpopular Travel Authorisation fees, which were introduced in the wake of Covid-19 and eliminated in November 2022.
The suggestion sparked backlash from both inside and outside of the party, with Mr Simons apologising a week later for not adequately consulting or vetting the suggestions with the party’s caucus.
“It was an error in judgment for me to do this without consultation, and I would like to extend a public apology to them and the people of Bermuda,” he said.
“Let me stress, the OBA does not want to see the residents of Bermuda burdened with any additional taxes and they do not wish to see the reintroduction of the Travel Authorisation or any affiliated fees. The OBA will not reintroduce the TA in any form.”
Mr Simons was gone as party leader by the autumn, allowed to retire from politics altogether on his 71st birthday.