Year in Review

December: Plunge taken on landmark tax

Pinterest LinkedIn Tumblr

A momentous occasion for an island with a jealously guarded business reputation came before Bermuda’s lawmakers in December with the approval of the Corporate Income Tax Act. 

Scheduled to come into force in 2025, the legislation will transform how Bermuda does business — at least as far as major multinational enterprises are concerned. 

David Burt, the Premier and Minister of Finance, emphasised that it was too early to tell what the outcome might be of levying a 15 per cent tariff on corporations with yearly takings of at least €750 million (about $827 million). 

The Bill got the green light in the House of Assembly on December 15, followed by the Senate three days later. 

There was little debate that the tax would have an extraordinary impact on the Government’s revenues. 

Where MPs clashed was on the question of how to apply the funds. 

The Premier bridled at a move by the One Bermuda Alliance to earmark the revenues for paying down Bermuda’s national debt. 

Mr Burt chided the Opposition, accusing the OBA of presuming to know better than bodies such as the Tax Working Group and the Tax Reform Commission — telling the House it was far too early to allocate future revenues to anything specific. 

Opposition MP Michael Dunkley responded that the proposal was merely an amendment that the government side could vote down. 

The Opposition gave guarded support overall. 

In the end, the OBA’s suggestion was ruled out by Dennis Lister, the Speaker of the House, because it had been put forward for a money Bill affecting the Government’s revenue. 

The Fiscal Responsibility Panel recommended that the island seize the opportunity of such a landmark change to overhaul its tax system, including moving away from payroll tax to a low-rate personal income tax. 

The island is likely to see revenues coming in by 2026 — but December 2023 marked the end of the debate. 

Bermuda’s top judge wrapped up his tenure in December after more than five years on the job. 

Narinder Hargun looked forward to travelling and spending time with family after stepping down as Chief Justice, with his career devoted to the island’s commercial courts as well as some milestone constitutional cases. 

Mr Hargun revealed that the Government had agreed, at least in principle, to boost the number of judges in the commercial courts from two to three, adding that the move would strengthen Bermuda’s reputation for handling international business. 

December took a tragic turn for Bermuda and the loved ones of Steve Parkes, who would have turned 54 on Christmas Day. 

The carpenter and family man was shot dead on the night of December 11 in an attack in the Mary Victoria Road neighbourhood of Devonshire. 

Police described the killing, which marked the island’s fourth murder of 2023, as a grim case of mistaken identity. 

MPs in the House of Assembly called Mr Parkes a community-minded man looking to use his skills to help the island’s disaffected young people. 

A predawn fire on December 14 swept through the Boatport Boat Storage facility in St George’s, with roughly 40 vessels consumed in the blaze. 

The scale of the destruction shocked the community, and the East End in particular, with boats exploding and sheets of flame billowing into the skies over Wellington Slip Road. 

The loss to boat owners is likely to be tallied in the millions, and the fire came as a gut-wrenching blow to William and Edward Lawrence, owners of the facility. 

The cause of the blaze remains under investigation by the Bermuda Fire and Rescue Service. 

Bermuda’s high cost of living was a refrain throughout 2023. 

Electricity costs sparked a rare public protest outside Belco when the rise in global oil prices caused the energy regulator to approve a hike in the fuel adjustment rate. 

But there was a reprieve for consumers in December, when the Regulatory Authority announced the FAR would drop again starting in January. 

Lastly, 2023 will be remembered by many for epic levels of rain. 

It was the wettest year since modern record-keeping began in 1949. 

The constant downpours caused havoc for Bermuda’s roads, but at least left residents with brimming water tanks. 

Write A Comment