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Tax cuts may impact local farmers (Nassau Guardian)
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Posted by:Jun 16th 2008, 11:23:54 am
Fig Tree News TeamBy KRYSTEL ROLLE, Guardian Staff Reporter,

The tax cuts in the 2008-2009 Budget are threatening to "close down" the already dwindling farming industry, as farmers will find it even harder to present competitive prices against those of imported products, said South Eleuthera MP Oswald Ingraham yesterday afternoon during the budget debate in the House of Assembly.

Last week, Prime Minister Hubert Ingraham announced tax cuts on 160 food items. Included in that line-up, taxes were eliminated for citrus products, including grapefruits, oranges, tangerines, limes and lemons. Stamp taxes and duties were also eliminated on cereals, spaghetti, bananas and plantains, the PM announced.

Meantime, the 25 percent import duty on watermelons and mangoes will be eliminated, along with the 30 percent import duty on guavas, peaches, frozen vegetables and oatmeal.

This spells bad news for the farming industry, which has steadily declined since the late 1970s, noted the South Eleuthera MP.

In the 1978 agricultural census, there were 4,214 farmers, but by 1994 it dropped to 1,727 and in 2005 the figure had fallen lower to 1,242.

"Today there are less than 1,000 farmers," said Ingraham, a former Speaker of the House of Assembly. "This budget will deplete the number of small farmers even more. Eleuthera is and has been a major producer of citrus, watermelons, mangoes, bananas, and guavas like Cat Island, Long Island, Andros, Abaco and Grand Bahama.

"Now the government has eliminated the duty and this will go a long way in the destruction of small farming in The Bahamas. When we think of the rate of duty decreases on these items, it's really frightening," he said.

Ingraham added that the decreases give foreign competitors a way to put small Bahamian farmers out of business. Yesterday, he appealed to the government to revisit some of the tax cuts in the budget.

"I see it doing us a great deal of harm in the future," he said referring to the tax cuts.

"The government has opened The Bahamas' market to products coming from countries like the United States, where the farmers and the agri-business sector are highly subsidized. As a result of this, these entities are in the position to close down farming in this country," Ingraham continued.

He added that the government should be pushing food security by encouraging farmers and agri-businesses to expand their farms.

He suggested the government control foreign access to The Bahamas' market and not "give our competitors from subsidized countries the tools to destroy our way of life."

The tax breaks, which are geared to help Bahamians survive as the cost of living escalates, however, come at a time when farmers are still struggling to re-build their crops following the destruction wrought during Tropical Storm Noel last year.

Ingraham said while farmers did get some relief, several are still waiting on financial assistance, fertilizer and seeds as promised by the government following the disaster.

"It's been over a year since Tropical Storm Noel and farmers are still hurting financially," Ingraham noted.

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