The Premier announced positive financial news - the 2022/23 budget deficit was $23 million lower than expected at $46.9 million, and government collected $15.7 million in back taxes (double the target). For the first time in almost 20 years, Bermuda is paying down $50 million of its debt. The Deputy Premier reported on leading other British Overseas Territories at the UN climate summit, securing a potential UK climate fund. The Works Minister apologized for the terrible road conditions, explaining that the main asphalt plant has been broken most of the year.
Government's financial update showing reduced budget deficit and first debt repayment in 20 yearsBermuda's participation in COP28 climate change conference in DubaiMajor road repair delays due to broken equipment and supply chain issuesCARICOM's new gender equality strategy development
Bills & Motions
Pre-Budget Report for 2024/25 tabled for public consultation
Various government reports tabled including Fiscal Responsibility Panel assessment and airport authority annual report
Notable Moments
Premier celebrated debt reduction as a major milestone after nearly two decades of increasing debt
Works Minister issued a public apology for road conditions and acknowledged "few of the plans to address this situation have been successful"
Deputy Premier secured commitment from UK for potential climate funding specifically for overseas territories
Debate Transcript
622 speeches from 31 speakers
The SpeakerThe SpeakerGood morning, Members . The Acting Clerk will lead us in prayer . PRAYERS [ Prayers read by Mr. Clark Somner , Acting Clerk ]
The SpeakerThe SpeakerThank you, Acting Clerk. Good morning, Members. The House is now in session. [ Gavel] CONFIRMATION OF MINUTES [Minutes of 8 December 202 3]
The SpeakerThe SpeakerMinutes of the 8th of December have been circulated. Are there any amendments required? None. The Minutes will be confirmed as printed. [ Minutes of 8 December 202 3 confirmed] MESSAGES FROM THE GOVERNOR
The SpeakerThe SpeakerThere are none. ANNOUNCEMENTS BY THE SPEAKER OR MEMBER PRESIDING APOLOGY
The SpeakerThe SpeakerThe announcement this morning is that we have been informed that Honourable Member De Silva will not be present today. MESSAGES FROM THE SENATE
The SpeakerThe SpeakerThere are none. PAPERS AND OTHER COMMUNICATIONS TO THE HOUSE The Speaker: We have four papers this morning. The first is in the name of the Premier and Minister of Fi-nance. Premier. PR E-BUDGET REPORT IN ADVANCE OF FISCAL 2024/25 BERMUDA FISCAL RESPONSIBILITY PANEL ANNUAL ASSESSMENT 2023 Hon. E. David …
There are none. PAPERS AND OTHER COMMUNICATIONS TO THE HOUSE The Speaker: We have four papers this morning. The first is in the name of the Premier and Minister of Fi-nance. Premier. PR E-BUDGET REPORT IN ADVANCE OF FISCAL 2024/25 BERMUDA FISCAL RESPONSIBILITY PANEL ANNUAL ASSESSMENT 2023 Hon. E. David Burt: Mr. Speaker, I have the honour to attach [and submit] for the information of the Honoura-ble House of Assembly the Pre-Budget Report in Advance of Fiscal 2024/25, and also the Bermuda Fiscal Responsibility Panel Annual Assessment 2023.
The SpeakerThe SpeakerThank you. The next is in the name of the Minister of Transport. Minister. BERMUDA AIRPORT AUTHORITY 2022 ANNUAL REPORT Hon. Wayne L. Furbert: Thank you, Mr. Speaker. I have the honour to attach and submit for the information of the Honourable House of Assembly the 2022 Annual Report of …
Thank you. The next is in the name of the Minister of Transport. Minister. BERMUDA AIRPORT AUTHORITY 2022 ANNUAL REPORT Hon. Wayne L. Furbert: Thank you, Mr. Speaker. I have the honour to attach and submit for the information of the Honourable House of Assembly the 2022 Annual Report of the Bermuda Airport Authority in accordance with section 23 of the Bermuda Airport Authority Act 2017.
The SpeakerThe SpeakerThank you. And the final one this morning is in the name of the Minister of the Cabinet Office. Minister. Hon. Vance Campbell: Good morning, Mr. Speaker.
The SpeakerThe SpeakerGood morning. TRADE MARKS REGULATIONS 2023 Hon. Vance Campbell: I have the honour to attach and submit for the information of the Honourable House of Assembly the Trade Marks Regulations 2023 made by the Minister responsible for intellectual property in exercise of the power conferred by section 94 of the …
Good morning. TRADE MARKS REGULATIONS 2023 Hon. Vance Campbell: I have the honour to attach and submit for the information of the Honourable House of Assembly the Trade Marks Regulations 2023 made by the Minister responsible for intellectual property in exercise of the power conferred by section 94 of the Trade Marks Act 2023. 224 15 December 2023 Official Hansard Report
Bermuda House of Assembly Thank you.
The SpeakerThe SpeakerThank you. That moves us on. PETITIONS
The SpeakerThe SpeakerThere are none. STATEMENTS BY MINISTERS AND JUNIOR MINISTERS
The SpeakerThe SpeakerThe first Statement this morning is from the Premier. Premier, would you like to present your first Statement ? Hon. E. David Burt: Certainly, Mr. Speaker. And good morning to you.
The SpeakerThe SpeakerGood morning. MID-YEAR FINANCIAL UPDATE AND TABLING OF THE PRE -BUDGET REPORT & REPORT OF THE FISCAL RESPONSIBILITY PANEL Hon. E. David Burt: Mr. Speaker, it is an honour to rise today on behalf of the Government in our last sitting of 2023 to provide an economic and fiscal update …
Good morning.
MID-YEAR FINANCIAL UPDATE AND TABLING OF THE PRE -BUDGET REPORT & REPORT OF THE FISCAL RESPONSIBILITY PANEL Hon. E. David Burt: Mr. Speaker, it is an honour to rise today on behalf of the Government in our last sitting of 2023 to provide an economic and fiscal update to this Honourable House and the people of Bermuda. This Statement will cover the latest report from the Fiscal Responsibility Panel, the Government’s mid- year financial performance and the Government’s Pre- Budget Report tabled moments ago. Mr. Speaker, earlier today I laid for the information of this Honourable House the Bermuda Fiscal Responsibility Panel Annual Assessment Report 2023 (which I will refer to hereinafter as the Report), which can be found on the Finance Minister section of the Bermuda Government portal. The Report represents the ninth annual report of the Fiscal Responsibility Panel [the Panel], a reputable and independent com-mittee to review, monitor, assess and publicly report on the fiscal progress of the Bermuda Government. The Panel is composed of a team of international experts, chaired by Jonathan Portes, a former government chief economist and UK Treasury official and now a lecturer in economics and tax policy at King’s College in London. Other members of the Panel are Marian Bell, a former external member of the Market Policy Committee at the Bank of England, who also previously advised on fiscal matters to the Government of Jersey; and Victoria Perry, a US tax lawyer who re-cently retired from the International Monetary F und, having spent many years providing technical advice to countries on tax policy and revenue administration. Mr. Speaker, as part of their assessment, the Panel met with members of the Government, Opposition, trade unions, international business and lo-cal business with the aim of listening to a breadth of information and perspectives for their Report. As a re-sult, the Report contains a comprehensive analysis of Bermuda’s fiscal and economic position, its strategy and related actions. Also within the Report, the Panel highlights their assessment of critical risks facing Bermuda and provides recommendations for several key areas impacting Bermuda's economic outlook. Mr. Speaker, I am pleased to advise this Honourable House that after their assessment, the Panel endorsed key aspects of the Government’s fiscal and economic strategy, including the Government’s commitment to remain within its fiscal guardrails as well as positioning itse lf to achieve a balanced budget in 2024/25 and a surplus of $50 million by 2026/ 27. Within the Report, the Panel stated the Government “has done well over the past few years to maintain a creditable path towards a balanced budget , despite a number of adverse shocks, most obviously the pandemic. Spending has generally been kept under control, and steady revenue growth has therefore largely fed through into deficit reduction.” Mr. Speaker, I am also pleased that the Panel envisions the implementation of a Corporate Income Tax regime as having huge potential benefits for the country while acknowledging a number of associated risks. Also within their report, the Panel stated, (and I quote) “The combination of the introduction of a CIT” (Corporate Income Tax ) “and relative economic stability means Bermuda has a chance to put things on a better footing now, for the long term. The Government’s objective that the CIT should not result in an increase in the cost of living or doing business in Bermuda is understandable.” Mr. Speaker, although we may not agree on every recommendation, the Government sees value and appreciates the members of the Bermuda Fiscal Responsibility Panel as they represent an independent assessment of the [ Bermuda] Government ’s financial position, and I urge all Honourable Members to take note of their report and their recommendations. Mr. Speaker, I will now provide updates on the Government's fiscal performance to this Honourable House. Before I give a mid- year update for the current fiscal year 2023/24, it is important to touch on the results from the last fiscal year. Total revenue for fiscal year 2022/23 is projected to be $1.113 billion, which is $35.2 million above the original estimate of $1.078 bil-lion; current account expenditure is expected to be $950[.3] million , $5.2 million above the 2022/23 original estimate of $945.1 mill ion; and capital account expenditures are projected to be $68.2 million, $4.8 million less than originally budgeted. Mr. Speaker, I am pleased to announce that the 2022/23 budget deficit is now expected to be only $46.9 million, which is $23.1 million ( or 33 per cent) below the [ 2022/23 ] original estimate of $70.0 million and $30.4 million below the [2022/23] revised estimate of
Bermuda House of Assembly $77.4 million, which I shared with this Honourable House in February . The projected deficit also represents a $13.1 million reduction compared to the previ-ous fiscal year. It is important to note, Mr. Speaker, that this reduction was achieved in spite of the government not receiving $30.1 million of budgeted revenue due to the impact of the Russia/Ukraine war on the aircraft register, forgone customs duty to freeze fuel prices, and forgone customs duty as a result of eliminating d uty on essential goods —and in spite of $15.2 million of unbudgeted COVID -19 expenditures , a $15 million grant provided to the Bermuda Hospitals Board and additional funding for firefighters at the airport to ensure we met the necessary requirements to keep the airport open. Mr. Speaker, t his demonstrates that despite the global economic challenges, the Government's sound fiscal management is resulting in continued progress toward a balanced budget. Mr. Speaker, t urning to the current fiscal year 2023/24, the Government’s mid- year assessment indicates that total revenue is projected at $1.16 billion, which is on track with the original budgeted figure. The revenue figure represents continued economic recovery evidenced by expected increases in tourism -related revenues, payroll tax, and land tax . Mr. Speaker, t otal current account expenditure is revised to be $984.5 million, which is $11.9 million above the original estimate of $972.6 million. The projected increase is primarily due to a further $16.4 million grant to the Bermuda Hospitals Board in support of the hospital. Interest and g uarantee management costs are projected to be $130.4 million, which is on track with the original budgeted figure, as at this time there are no unbudgeted or unexpected costs this fiscal year. Mr. Speaker, capital account expenditures are projected to be $85 million, which is $11 [million] less than the original estimate of $ 96 million. It is anticipated that underspend in capital account expenditures is mainly due to the availability of construction resources and continuing supply chain delays. Mr. Speaker, the revised budget deficit for the current fiscal year is $44.4 million, which is $900,000 more than the original budgeted figure of $43.5 million. This projected deficit is relatively on track with the original estimates despite unbudgeted costs associated with the funding boost for the hospital and a negotiated increase in salaries and wages for public officers. Keeping the deficit in line with estimates despite these additional unbudgeted expenses is a laudable achieve-ment. Mr. Speaker, t he balance of the sinking fund as of September 2023 was $199.2 million. The Finance Ministry ’s aim is to maintain a minimum balance of $100 million in the sinking fund, and therefore, after funding the projected deficit for this fiscal year, making the $50 million debt repayment . With a balanced budget projected for next year, the Government expects to achieve this objective, and the $100 million in the sinking fund will be set aside for future debt repayments. Mr. Speaker, this Government continues to demonstrate sound fiscal prudence and the ability to be good stewards of the public purse. Though the Opposi-tion may focus on a few missteps , I remind the public and Honourable Members that no government gets it 100 per cent right 100 per cent of the time. But , Mr. Speaker, we have delivered relief to Bermudians challenged with the highest global inflation seen in 40 years through tax and duty cuts, we have made investments in affordable housing and critical infrastructure, we have maintained our credit ratings, and today we are repaying $50 million in debt —
[Desk thumping]
Hon. E. David Burt: —thus reducing our gross national debt for the first time in almost 20 years! Yes, Mr. Speaker, things are moving in the right direction. But, Mr. Speaker, the positive news does not stop there. During this year’s Budget Statement , the Government pledged to collect at least $7.5 million in back taxes during this fi scal year. Mr. Speaker, I am pleased to report to this Honourable House and the people of Bermuda that the Office of the Tax Commissioner, through the month of November, has collected $15.7 million in back taxes , far exceeding the full -year budget target.
[Desk thumping]
Hon. E. David Burt: Mr. Speaker, t his is a result of the Office of the Tax Commissioner implementing a new debt management system, which has proven to be effective . Mr. Speaker, when we return to this Honourable House next year, it will be for our Budget Session . And o ne of the key steps in the budget process is the publishing of a Pre- Budget Report. Earlier today I tabled the Pre- Budget Report in advance of fiscal year 2024/25 on behalf of the Ministry of Finance. As Honourable Members will be aware, the Pre- Budget Report is a document produced annually by the Government to provide the public with a better understanding of our fiscal aims and objectives, an update on our economy, a summary of the policies under consideration and to solicit the public’s feedback. Mr. Speaker, like most small states and territories, Bermuda’s economy is extremely vulnerable to ex-ternal events, underlining the need for financial and fiscal prudence. This vulnerability is compounded by Bermuda’s level of government [ net] debt, which is currently at $3.1 billion. Accordingly, this Government must take appropriate action to address the problems the Island faces head- on. It is also important that stakeholders and citizens understand these challenges, are aware of the factors influencing the Government's fiscal policy decisions and utilise the opportunity to give their 226 15 December 2023 Official Hansard Report
Bermuda House of Assembly views, as it will help to ensure that we achieve the best outcome for Bermuda. Mr. Speaker, the key factors which therefore must be considered in the framing and composition of the 2024 /25 Budget are as follows: • the Government’s 2020 General Election Campaign Platform and the 202 3 Throne Speech— to ensure that the commitments made are appropriately met ; • relevant economic considerations —whether globally in relation to our major trading partner the United States, or the economic realities that exist in the Bermuda context ; • taxation sensitivities —recognising that international business is a key contributor to tax revenue, consideration has to be given to the po-tential impact of decisions on this sector ; • the need for continued fiscal discipline to further reduce deficits on the path toward a balanced budget in [fiscal year] 2024/25 and ultimate reduction in net debt levels ; • the requirements for continued investment and support for the initiatives within Bermuda’s Economic Development Strategy ; • continued effective use of zero- based budgeting and the use of public value assessment outputs to enhance efficiency and cost -effective utilisation of resources ; • the appropriate evaluation of the highlighted risks and implementation of the recommendations from the 2023 R eport of the Fiscal Responsibility Panel, whose role and work have already been addressed in this S tatement ; and finally, of course, Mr. Speaker, • feedback from the Pre- Budget Report consultation. Mr. Speaker, during preliminary discussions with key stakeholder groups , the following policy initiatives were included in the Pre- Budget Report for consideration and feedback : • amendments to the existing new hire relief that is set to expire this year ; • consideration of increasing boat licensing fees for large pleasure craft ; • consideration of further reduction of employer payroll tax for the hospitality [sector] ; • consideration of the reduction of immigration fees for work permit applications ; • consideration for the reduction of land tax; and • consideration toward expanding the list of items subject to customs duty relief . Mr. Speaker, I would like to emphasise that none of the aforementioned proposals included in the Pre-Budget Report are policy positions of the Government. They are simply options put forth for consideration, and the Government is inviting the public to be a part of that process by making recommendations for key changes in tax policy or spending priorities. Mr. Speaker , the Pre-Budget Report is an important document that promotes transparency in the budget process, reinforces accountability and allows for effective collaboration on matters that will have a significant impact on individuals and businesses in the community. As a result, in January during the consultation period, we will arrange meetings with members of the international business community, the Chamber of Commerce, the Trade Union Congress, Bermuda Bankers Association and other key stakeholder gr oups to ensure the upcoming budget is a reflection of the wider community. Mr. Speaker , it is worth noting that during the consultation period, we also encourage the wider public to read the Pre- Budget Report and submit their thoughts, recommendations and concerns by email to openbudget@gov.bm or via the g overnment consultation portal, which is found at forum.gov.bm . Once the consultation period has ended on January 17, we will evaluate all responses as the Ministry of Finance looks to finalise the budget for presentation to the Cabinet and ultimately to this Honourable House. In closing, Mr. Speaker, as we have stated on many occasions, this Government is committed to tak-ing care of its people while ensuring its fiscal and economic policies contribute to sustained growth and sta-bility. Our track record has been positively assessed by independent reviewers, our deficits are narrowing, our debt is being repaid, back taxes are being collected and we remain committed to a path that will ensure a bright future for generations to come. Thank you, Mr. Speaker .
The SpeakerThe SpeakerThank you, Mr. Premier. Members, the second Statement this morning is also in the name of the Premier . . . I am sorry, the Deputy Premier. I am sorry. It is the Deputy Premier on the COP28 report. Deputy Premier, would you like to present your Statement at this …
Thank you, Mr. Premier. Members, the second Statement this morning is also in the name of the Premier . . . I am sorry, the Deputy Premier. I am sorry. It is the Deputy Premier on the COP28 report. Deputy Premier, would you like to present your Statement at this time? Hon. Walter H. Roban: Thank you very much, Mr. Speaker.
The SpeakerThe SpeakerGo right ahead. Hon. Walter H. Roban: Good morning to you and Members of the House and the listening public.
The SpeakerThe SpeakerGood morning. 28 TH UNITED NATIONS CLIMATE CHANGE CONFERENCE OF THE PARTIES (COP28) , UNITED ARAB EMIRATES FROM 30 NOVEMBER TO 12 DECEMBER 2023 Hon. Walter H. Roban: Mr. Speaker, I rise to inform this Honourable House of Bermuda’s representation at the United Nations Climate Change Conference in the Bermuda …
Good morning.
28 TH UNITED NATIONS CLIMATE CHANGE CONFERENCE OF THE PARTIES (COP28) , UNITED ARAB EMIRATES FROM 30 NOVEMBER TO 12 DECEMBER 2023 Hon. Walter H. Roban: Mr. Speaker, I rise to inform this Honourable House of Bermuda’s representation at the United Nations Climate Change Conference in the
Bermuda House of Assembly United Arab Emirates, otherwise known as COP28. Bermuda’s presence at COP28 is important for the highest level of diplomatic engagement for global cooperation and collaboration, which presents an opportunity for Bermuda to build relationships, exchange ideas and shape outcomes with key figures we normally would not have access to. Mr. Speaker, at COP26, which was in Glasgow two years ago, I had the pleasure of leading a delegation of Environment Ministers across the Overseas Territories. I again had the honour to be asked to lead the delegation of Environment Ministers to COP28 in Dubai, United Arab Emirates. At COP26, it was through Bermuda’s Chairmanship under the United Kingdom Overseas Territories Association (often known as UKOTA) that Bermuda took the charge to ensure that British Overseas Territories had the right to be heard and properly represented at every COP under the UK delegation. Through strong lobbying efforts by UK representatives based in London, our representation increased immensely to ensure that every territory at Government level would be afforded a delegation to collectively represent our position. At COP28 all Overseas Territories were afforded the opportunity to be represented for the first time ever. We have a shared ambition to work toward net zero, as we are all on the front line of climate change. We are custodians of internationally important habitats which span the globe from the Antarctic to the Caribbean, from the South Atlantic to the Indian Ocean. Together with the UK we represent the world’s fifth-largest marine estate and over 90 per cent of the UK’s biodiversity, and we are essential to the UK ’s meeting its pledge by 2030 to protect 30 per cent of the world’s oceans. Climate change will have a profound impact upon our environments, economies and societies . A failure to act will impact not just us, but our children and all generations to come. To overcome the climate crisis facing our communities , we must increase global solidarity and align our actions. As coastal and island com-munities, our economies rely upon maintaining healthy, sustainable marine and terrestrial environments. Together we have committed to take action to protect our fisheries r esources and to conserv e and, wherever possible, restore our marine ecosystems and biodiversity. Building on the good work already taken across the Overseas Territories, we reaffirmed an alliance to take action to tackle the harmful effects of plas-tic pollution and marine litter often as a result of other countries which have impacted our shores. Our biodiversity, terrestrial and marine, not only support our wellbeing but also contribute to our uniqueness and our nature-based fight against climate change, and is important to those of us [who live and work] where tourism makes an important contribution to our economies. Mr. Speaker, Bermuda has committed to a world -leading economic exclusive zone representing 20 per cent of our marine estate in which there will be no harvesting of resources or other economic activity. We are already seeing significant recovery in the spawning grounds. We are proud to be part of the UK’s Blue Shield oceanic protection programme. For Bermuda, our net zero priorities are focused on the following goals: • our Integrated Resource Plan (IRP, as it is called) goal is to decarbonise energy generation to 85 per cent by 2035; • decarbonise transport, public, commercial and private, by 2035; • make requisite planning building code provi-sions to decarbonise construction and raise commercial conservation and efficiency levels; • imbed conservation and efficiency into residential development; and • focus on better demand- side management amongst residents through an effective future tree-planting policy spread over the Island for sustainable tree coverage. Mr. Speaker, for the benefit of the Honourable House, I have tabled (Mr. Speaker, this is the document here that I wish to table) the document that was recently launched at COP28 entitled “The Bermuda Difference [White Paper]: Bringing expertise, resource, and finance to the world’s biggest challenge,” for the benefit of Honourable Members and the community. As an island community vulnerable to the effects of climate change, and as a global capital of climate- related financial risk management, we are deter mined that Bermuda will participate in the international response to ensure our collective safety and prosperity. To that end, Bermuda is committed to increasing protection of our fragile ecosystem, reducing our carbon footprint and mitigating the impact o f climate change. As evidenced in the document tabled, the work has already begun. Mr. Speaker, I had the opportunity to join a panel discussion in the UK Pavilion in the highest -level accredited zone. The event was chaired by Minister Graham Stuart, Minister of State for Climate, the Department for Energy Security and Net Zero, who als o led the UK’s negotiations at COP28. The panel [was] entitled “On the frontline: how are the UK’s Overseas Territories and Crown Dependencies getting to net zero, adapting to and dealing with the impacts of climate change?” The discussion focused on being small islands and the impact of climate change in our territories, our progress, lessons learned and challenges we face in meeting net zero and how they incorporate youth perspectives in policy making as our future— to ensure we can collectively meet our s hared ambitions on net zero and the goals of the Paris Agreement. I highlighted that although Bermuda will not adopt the Paris Agreement, we are ever more committed to net zero. We are beyond aspirational with innovation such as the Bermuda sandbox legislation which demonstrates this. Bermuda’s leadership is exemplified with the decarbonisation of public transport, the rapid 228 15 December 2023 Official Hansard Report
Bermuda House of Assembly deployment of solar panels on government buildings, waste- to-energy conversion and the development of the only wave energy park in the region. Following the panel, I had a frank discussion with Minister Stuart, who was complimentary of Bermuda’s accomplishments and global leadership, not just amongst the territories but across the region, with our actions related to protect our climate. The Minis ter highlighted the need for innovation and driving the so-lutions of the future, and we reflected on the communities’ experience with the planned deployment of off-shore wind. Mr. Speaker, throughout the summit I was able to speak on several panels with the highest level of ac-creditation at COP28 and was afforded the opportunity to deliver a keynote address on the first day of the Island Innovation Pavilion, Island of Hope, where I was able to speak about the key role small island states play in preserving ocean health. I highlighted that we are a custodian of a vast marine area, and Bermuda has an important role to play. What is certain [is that] Bermuda is observed amongst sma ll island jurisdictions as a leader in our approach to tackling climate change. Our dedication through our community, environmental partners and government departments is admired by many in the region. We need to change the narrative: We are not a small is land state; we are a large marine state. Additionally, I was able to support a ministerial panel discussion at the CARICOM Pavilion alongside my counterparts across the Overseas Territories. We addressed the need to coordinate climate finance across the territories and the challenges non- sovereign jurisdictions face in accessing climate finance. This sentiment is shared not only with British Overseas Ter-ritories but all non- sovereign territories across the world. Mr. Speaker, it was particularly encouraging to have a formal meeting with the President of COP26, Sir Alok Sharma, MP, in his role as a Fellow of the Rockefeller Foundation. He was interested in discussing how he could support Overseas Territories in the ir relationship with the UK Government and with the work of the Rockefeller Foundation. His commitment to supporting small jurisdictions who are vulnerable to climate change is highly recognised. I look forward to future collaborative engagements in his new endeavours in the environment space. Mr. Speaker, while in the UAE [ United Arab Emirates ] I was keen to support a Bermudian who is making a difference in the climate finance arena, Mr. Kevin Richards. It was important that we encourage the next generation who are providing unique opportunities for job creation and economic diversification for Bermuda. It was encouraging that Mr. Richards was able to host a Bermuda Day to key stakeholders in the UAE who have a potential interest to invest in Bermuda. It was a pleasure to support as I delivered the keynote address at an industry -focused Bermuda Day event, highlighting Bermuda’s ambitions for COP. This Government is supporting innovation in the climate space, including climate finance, and will continue to encourage Bermudians to succeed in this field. Mr. Speaker, the most important accomplishment achieved at COP28 was securing a commitment from the Department for Energy Security and Net Zero through Minister Stuart to support a climate change fund dedicated to the Overseas Territories [OTs]. I led the OT delegation in the meeting where we secured the pledge by the Minister to explore this commitment with the Foreign Commonwealth and Development Office and His Majesty’s Treasury. The UK Government has recently pledged £100 million of UK funding to support climate -vulnerable populations to adapt to climate change. Vulnerable countries will be provided with as-sistance from the UK Government to strengthen the resilience to the increasingly frequent and severe effects of climate change. Where it relates to t he territories, our UK representatives in London will work together with relevant UK Government departments to develop a transparent, dedicated source of climate funding. Mr. Speaker, in addition to all of the showcasing of Bermuda’s story, we were very much working alongside the UK negotiation team to ensure that OT priorities were properly represented at the table. Each morning the lead negotiator for the Overseas Territ ories met with the delegation. As the UK is our representation under UNFCCC [United Nations Framework Convention on Climate Change], we were able to feed into the negotiations on areas including global stocktake, mitigation, adaptation, finance, transparency and Article 6 of the Paris Agreement. As an innovative jurisdiction on the front line of climate change, Bermuda’s voice is acknowledged and respected. Mr. Speaker, there was unprecedented youth interest in COP28. There was for the first time a significant delegation of Bermudian youth in attendance. We are proud of such a strong youth voice stemming from Bermuda. In view of this, we are already exploring avenues to increase youth accreditation for Bermudians at COP29, which will be in Azerbaijan. Bermuda’s youth delegation included Noelle Young, Zayne Sinclair, Malachi Symonds, Olly Cherry, William Campbell and Isaiah Fraser. The Bermuda Government Londo n Office, supported by Ms. Kimberley Durrant, UK Representative for the Government of Bermuda, and Mr. Brandon Sousa, have facilitated Bermuda’s presence at previous COPs and will continue to build on this important representation, collectively, with overs eas territories and Bermuda, specifically. COP is important to Bermuda, and Bermuda’s participation is important to the discussion of addressing climate change. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, Deputy Premier. Members, the next Statement this morning is in the name of the Minister of Works. Minister. Bermuda House of Assembly Lt. Col. Hon. David A. Burch: Good morning, Mr. Speaker.
The SpeakerThe SpeakerGood morning. ROAD PAVING AND EQUIPMENT UPDATE
Lt. Col. Hon. David A. BurchMr. Speaker, on numerous occasions I have risen in this Honourable House to provide updates on the continuing roadwork projects across the Island, namely, the BELCO Infrastructure Project, the Ministry of Public Works Water and Wastewater Master Plan Phase I works in St. George’s, as well as road paving generally. …
Mr. Speaker, on numerous occasions I have risen in this Honourable House to provide updates on the continuing roadwork projects
across the Island, namely, the BELCO Infrastructure Project, the Ministry of Public Works Water and Wastewater Master Plan Phase I works in St. George’s, as well as road paving generally. There have been five Ministerial Statements made on this matter since the original project announcements back in February 2020, the most recent being in July of this year. As this is the most pressing issue facing Bermudians, followed closely by housing, I shall continue these reports to keep the motoring public informed of progress. Mr. Speaker, let me begin by apologising to the people of Bermuda and those who live here and use our roads for the state [the roads] are in. They are in a significant state of disrepair, and few of the plans to address this situation have been successful. I will set out the status and plans underway and forthcoming to ad-dress this situation. Mr. Speaker, I remind [you] that both the BELCO Infrastructure Project and the Water and Wastewater Master Plan Phase I works in St. George’s are inconvenient and uncomfortable in the immediate for the motoring public. However, the sacrifice is worth the wait, because when completed we will see the pro-tection of our freshwater supplies, the protection of our electrical infrastructure, and the [assurance] that the sewage we produce is properly disposed of in a more environmentally conscious way. Mr. Speaker, while these works are progressing steadily, the final phase of the BELCO trenching works from Frank’s Bay in Southampton to the Evans Bay substation have been paused until the New Year. I can report that much of this trenching work will occur on the Railway Trail rather than the main road, thus providing some relief to those travelling out of the west. The trenching for the Water and Wastewater Master Plan Phase I works in St. George’s has been completed, and we are in the throes of commission ing the new Reverse Osmosis and Sewage Treatment Plants, gradually bringing on line residents and businesses in St. George’s and Southside. Mr. Speaker, accolades must be given to the Works and Engineering Department’s asphalt crews ably led by Principal Highways Engineer, Ms. Tina Beer -Searle, all of whom have worked tirelessly under very trying conditions to address the magnitude of pav-ing requests and pothole complaints that we have received. This year alone the Ministry of Public Works as-phalt crews have, in conjunction with East End Asphalt, • completed repair works for uneven surfaces along Mullet Bay Road, near Stokes Point Road, St. David’s Road entrance, Kindley Field Road, Middle Road at Warwick Academy and Middle Road at St. Anthony’s Church; • completed the permanent paving for trenching works at York Street in St. George’s, Harrington Sound Road to the Leamington Caves area, Harrington Sound Road from Shark Hole to Paynter’s Road and Devil’s Hole to Harring-ton Hundreds entrance; • completed the temporary paving of BELCO trench work along Middle Road in Warwick and Southampton, Palmetto Road, Old Military Road and Frog Lane in Devonshire, and multi-ple road crossings in St. David’s Parish; • completed drainage improvements by creating an asphalt lip on Perimeter Lane at the Glebe Road junction and installed a drainage channel at the Glebe Road bus layby to allow for excess rainwater to be redirected into the nearby canal; • resurfaced the netball courts near the W.E.R Joell Tennis Stadium that are being utilised by schools and the public; • paved the Watford Bridge lanes; and • fixed hundreds of potholes, most of which were reported to the email at potholes@gov.bm . Mr. Speaker, I can assure this House that the dedicated crews continue their diligence in working to complete the other scheduled works for this financial year, such as Harrington Sound Road in Hamilton Parish, South Road in Southampton near Henry the VII I, Middle Road in Warwick near T. N. Tatem and South Road at the Collectors Hill Road junction. Mr. Speaker, I must mention some of the issues that the Ministry has encountered while undertak-ing road paving that have contributed to the delays. Mr. Speaker, the government’s physical assets are ageing. This is not new. Successive Administrations have stated this. In this case, the machinery that supports road paving works is also ageing and therefore routinely out of service for repairs. The unreliability of these machines —the asphalt plant and asphalt miller in particular —causes the asphalt teams to slow their production. Currently both assets are out of service and have been for most of the year, awaiting repairs. In addition to this, the excessively complicated administrative procedure to procure asphalting supplies or parts and global supply chain issues have also exacerbated the situation. Simply put, when the machines are working we may not have the full complement of supplies, and conversely when they are not working we likely have the supplies. Steps are being taken to alleviate both of these cha llenges. Mr. Speaker, as I have said before, asphalting is an expensive business. The estimated price for paving just one kilometre (or half a mile) of roadway on both lanes is $600,000. These costs are broken down 230 15 December 2023 Official Hansard Report
Bermuda House of Assembly to a single major component, namely, the exorbitant price of asphalting material. It currently costs the Ministry 62 cents on every dollar used for road paving for this material. However, Mr. Speaker, the key to suc-cess is inherently knowing and understand ing the circumstances in which one is placed. Hence, the rationale that, before the current inoperability of the assets, the Ministry entered into a partnership arrangement with East End Asphalt, the sole private sector provider of bulk asphalt on the Island. This arrangement sees the sharing of supplies and usage of paving equip-ment and staffing resources on an as -needed basis at fixed rates. So currently, Mr. Speaker, the asphalt that our crews are using to pave Harrington Sound Road is purchased from East End Asphalt, and occasionally we rent their equipment so that paving works can continue. Additionally, we have an agreement with East End A sphalt to carry out paving works on our behalf as well, as recently done for the York Street, St. George’s, paving works. This protocol will continue while we work to get the plant operational again and explore options for the purchase of a new plant. Concurrent with the aforementioned activities, over the last few months on two occasions we have hosted representatives from Astec Industries, the provider of the current asphalt plant some 20 years ago and a leading provider of asphalt plants and paving equipment in the United States. Mr. Speaker, this week a team of three experts from Astec have been on Is-land, out in the field with our asphalting teams, observ-ing the process and the operation of equipment. The full Ministry team comprising myself, the Acting Permanent Secretary, the Acting Chief Engi-neer, the Quarry Manager, the Principal Highways Engineer and others associated with the highways team participated in a full debrief and discussion with the vis-iting experts on Wednes day last. The full report and recommendation with costings will come in January, but what was discussed was very encouraging. First, Astec, which is a fully comprehensive construction organisation, have a training school for asphalt workers at their headquarters in Chattanooga, Tennessee, and have offered places at the January sessions for several of our workers to attend, which we have accepted. The plan is to train the trainer there and subsequently provide training locally for all highways staff of new techniques and applications to enhance the asphalt -laying process. Mr. Speaker, Astec have identified several new pieces of equipment that can greatly assist us in being able to pave greater lengths of road in one go. They will present options for a new plant that will be able to deliver asphalt to meet the specific size and demand that Bermuda requires. Technology has advanced signifi-cantly since we purchased the current plant 20 years ago, and they will help us bring the current asphalting operations into the modern age. Mr. Speaker, as you know, we are currently in the budgetary process for next year. As is customary, not every dollar that is budgeted for a specific project is spent. So, during this process we are also exploring options to ensure that we have enough material and sup-plies to produce asphalt so that we can accelerate the pace of road- paving by transferring funds to the highways budget, should the need arise. But until such time that the new equipment arrives, Mr. Speaker, the Ministry will continue its efforts with works along Harrington Sound Road heading west toward Middle Road in Flatts, along Middle Road to Store Hill and then along the North Shore Road to the National Sports Centre. Mr. Speaker, let me summarise: • In January the paving works will continue with both our highways crew and East End’s crew conducting those works with asphalt produced by East End. • Overseas technicians will return to repair the current plant so that it is operational until the new plant is purchased and commissioned. • The specs and costing for a new plant and equipment will be received and acted upon. • An order will be placed for a new plant and various pieces of new equipment. • By the second quarter of 2024 the new plant will arrive and be commissioned. • In the February budget additional funding for roadworks will be requested. • During 2024 paving works throughout the Island will be increased. Mr. Speaker, I hope this update provides all with a clear understanding of the current situation and plan going forward. We are fully committed to addressing the dreadful state of our roads as quickly as possible. Let me end where I began, Mr. Speaker, by apologising to all road users for the delayed delivery of these projects and thanking the public for their patience and understanding. We will continue our efforts to advance the paving of our roads at an increased pace. As always, Mr. Speaker, I will keep this House and the public informed as we progress. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, Minister. Members, the final Statement this morning is in the name of the Minister for Youth, Social Development and Seniors. Minister. Hon. Tinee Furbert: Good morning and thank you, Mr. Speaker.
The SpeakerThe SpeakerGood morning. CARICOM’S DRAFT GENDER STRATEGY Bermuda House of Assembly Hon. Tinee Furbert: Mr. Speaker, I rise this morning as Minister responsible for gender affairs to share with this Honourable House and the public the goal that CARICOM is working toward to coordinate and accelerate efforts for achieving gender equality …
Good morning.
CARICOM’S DRAFT GENDER STRATEGY
Bermuda House of Assembly Hon. Tinee Furbert: Mr. Speaker, I rise this morning as Minister responsible for gender affairs to share with this Honourable House and the public the goal that CARICOM is working toward to coordinate and accelerate efforts for achieving gender equality and the em-powerment of women in the CARICOM region through a first -of-its-kind [draft] strategy entitled “Stepping it up: a strategy to achieve gender equality in the Car ibbean Community” [the Strategy]. This framework takes an inclusive and equitable approach post COVID -19 to achieve regional and international commitments which align with the United Nations Sustainable Development Goal 5, Gender Equality. Mr. Speaker, in 1995 the Fourth World Conference on Women held in Beijing, China, marked a significant pivotal shift for the global agenda for gender equality. The four world conferences on women united the international community behind a set of common objectives, with an effective plan of action for the advancement of women everywhere. At this time the Beijing Declaration and Platform for Action that provided an agenda for women’s empowerment was introduced. The Beijing Declaration and Platform for Actio n set strategic objectives and actions for the advancement of women and the achievement of gender equality in 12 critical areas of concern: 1. Women and poverty; 2. Education and training of women; 3. Women in health; 4. Violence against women; 5. Women and armed conflict; 6. Women and the economy; 7. Women in power and decision- making; 8. Institutional mechanism for the advancement of women; 9. Human rights of women; 10. Women and the media; 11. Women and the environment; and 12. The girl -child. This document has been adopted unanimously by 189 countries and is now considered the key global policy document on gender equality. Mr. Speaker, the UN Division for Women, in its review of the four world conferences, stated, “The fun-damental transformation that took place in Beijing was the recognition of the need to shift the focus from women to the concept of gender, recognizing that the entire structure of society, and all relations between men and women within it, had to be re-evaluated. Only by such a fundamental restructuring of society and its institutions could women be fully empowered to take their rightful place as equal partners with men in all aspects of life. This change represented a strong reaffirmation that women's rights were human rights and that gender equality was an issue of universal concern, benefiting all. ” Mr. Speaker, the draft version of this strategy is a mainstream document that is guided by the Beijing Declaration and Platform for Action and provides a regional coordinated approach. The draft Gender Strategy sets out the actions that must be taken to reduce existing social and economic inefficiencies that ad-versely impact the lives of men and women. Mr. Speaker, equality is the foundation of an inclusive, thriving society. However, no nation in the world has achieved gender equality. The draft Strategy shows CARICOM’s collective commitment to be a bea-con of hope not just in the region, but for the world to follow in achieving equality for all. To ensure the CARICOM region continues its journey to achieve gen-der equality, the draft Strategy focuses on actions to reduce social and economic inequalities that adversely affect the lives of women and men across the Carib-bean. Mr. Speaker, the Strategy’s mission is to strengthen the promotion and practice of gender equal-ity and the empowerment of women and girls to enhance regional integration and sustainable development to benefit all people. The goal is to accelerate the effective implementation of priority actions through a regional coordinated approach to achieve gender equality and the empowerment of[all] women and girls. And, Mr. Speaker, the guiding principles of the Strategy are human rights foundation, good governance, harmo-nisation, transformative partnership of women and men, and systematic mainstreaming. Mr. Speaker, during the past year, I have been participating in a series of virtual meetings held by CARICOM to gather input from CARICOM members and Associate Member States for strengthening the draft Strategy. The draft Strategy was also shared with the Chairs of the Gender Affairs Council and Cabinet for feedback. In October I was invited by the CARICOM Secretariat to participate in its 31 st Special Meeting of the Council for Human and Social Development (COHSOD) focusing on gender, which was held virtu-ally. The meeting provided an opportunity to collabora-tively review the strategy and discuss its implementa-tion and monitoring framework. The meeting allowed Member States and Associate Members to provide feedback. In attendance were ministers, permanent secretaries and representatives who shared or reiterated the gender position of their respective countries during the meeting as aligned with their domestic legis-lation or policies. Mr. Speaker, just last month CARICOM hosted its 46 th Meeting of the COHSOD focusing on gender in Bridgetown, Barbados. CARICOM invited ministers and technical officers to attend the meeting and funded all associated travel costs. The meeting was held on November 20 and 21. Countries physically represented at the meeting were The Bahamas, Barbados, Guyana, Montserrat, St. Kitts and Nevis, Suriname and Trinidad and Tobago. Those ministers responsible for gender affairs in attendance included Barbados, Guyana, St. Kitts and Nevis, and Trinidad and Tobago. Mr. Speaker, during the two- day meeting presentations focused on the following: 232 15 December 2023 Official Hansard Report
Bermuda House of Assembly • the Role of the Monitoring, Evaluation, Accountability and Learning [MEAL] Plan for the Strategy to ensure that outputs measuring the success of the implementation of the Strategy are measurable. This framework will assist in the reporting function of the Sustainable Development Goals; • regional knowledge products that included a KAP model knowledge assessment tool on social gender norms around Violence Against Women and Girls training guide and its impact on citizen security and education standards; • Member States' obligation to report on CEDAW [Convention on the Elimination of All Forms of Discrimination against Women] and the ratifi-cation of the optional protocol; and • a National Study on Economic Cost of Violence Against Women and Girls in Jamaica. Mr. Speaker, the draft Gender Strategy is structured around seven thematic areas that provide actionable pillars, as follows: 1. gender equality and social inclusion by promoting and protecting the human rights of women through the full implementation of CEDAW and other human rights instruments, paying close attention to those most vulnerable or marginalised; 2. freedom from violence through increasing measures to prevent and address all forms of gender -based violence and violence against children and youth; 3. economic empowerment by expanding equitable access for women and men to decent work, economic opportunities, productive resources and trade; 4. good governance by strengthening good gov-ernance processes in the public and private sectors, including women’s equal access to and participation in leadership and decisionmaking at all levels; 5. access to health services by taking steps to reduce risk factors related to maternal mortality, adolescent pregnancy and HIV/AIDS, particularly through increased access to sexual and reproductive health care services; 6. inclusive quality education by improving the quality of and access to education inclusive of human resource development and gender -responsive learning environments; and 7. sustainable natural resource management responding to gender differentials in access to environmental resources to maximise benefits to and increase the resilience of women, men, girls and boys to the effects and impacts of climate variables. The draft Gender Strategy is a working document for CARICOM Member States to use as a guideline for addressing gender equality that will need to be ratified. Mr. Speaker, in closing, the two- day meeting provided an opportunity for the Ministry to contribute to the content of the CARICOM Gender Strategy, gain insightful information about gender affairs and network with other ministers in the CARICOM region on broader gender -related matters, which in turn will help in the development of a gender affairs structure in Bermuda. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, Minister. Members, that brings us to an end of the Statements for this morning. We now move on to the next order on the Order Paper. REPORTS OF COMMITTEES
The SpeakerThe SpeakerWe have one report this morning, the Private Bills Committee Report on the Meanwhile Insurance Bitcoin (Bermuda) Limited Act 2023. And MP Ad-ams is going to present this this morning.
Mr. Jache Adams[To the Honourable Speaker and] the Honourable Members of the House of Assembly, the Parliamentary Joint Select Committee on Private Bills has the honour to submit the following report: The Committee has carefully considered the petition, together with the related Bill, for the Act listed hereunder and is satisfied that …
[To the Honourable Speaker and] the Honourable Members of the House of Assembly, the Parliamentary Joint Select Committee on Private Bills has the honour to submit the following report: The Committee has carefully considered the petition, together with the related Bill, for the Act listed hereunder and is satisfied that the Bill is a private Bill and that all of the rules of both Houses having to do with private Bills have been complied w ith. The Act is entitled Meanwhile Insurance Bitcoin (Bermuda) Limited Act 2023, which was originally entitled Standard Crypto Insurance— Bitcoin (Bermuda) Limited Act 2022. The Committee recommends that the Bill entitled the Meanwhile Insurance Bitcoin (Bermuda) Limited Act 2023 be accepted subject to agreed amendments. Subject to the recommendations contained in paragraph 2 herein, the Committee recommends that the prayers of the petitioners be granted and that leave be given to bring in the proposed Bill to give effect thereto.
Bermuda House of Assembly All of which is respectfully submitted by the Joint Select Committee of the Honourable Derrick Burgess, Chairman; Ianthia Simmons -Wade, JP, MP; Scott Pearman, JP, MP; myself, Jache Adams, MP; Senator Kiernan Bell, JP; and Senator Arianna Hodg-son. Thank you.
The SpeakerThe SpeakerThank you, Honourable Member. Members, that is the only Report of Committees submitted this morning. We now move on. QUESTION PERIOD
The SpeakerThe SpeakerMinisters, there are two Members who have questions from Statements this morning, and we will start with MP Pearman, who has a question for the Premier on his Statement in reference to the mid- year financial update. QUESTION 1: MID -YEAR FINANCIAL UPDATE AND TABLING OF THE PRE -BUDGET REPORT …
Mr. Scott PearmanGood morning, Mr. Speaker. Good morning, Honourable Premier and Minister of Finance. In respect of your Statement about the $50 million that is being paid, when is the $50 million being paid now due under the relevant loan note?
The SpeakerThe SpeakerPremier. Hon. E. David Burt: Thank you, Mr. Speaker. The $50 million is due today! And funds were transferred to Butterfield Bank yesterday to ensure that they did not charge the government any extra interest in saying that the payments may have been delayed. So, the funds have been transferred. …
Premier.
Hon. E. David Burt: Thank you, Mr. Speaker. The $50 million is due today! And funds were transferred to Butterfield Bank yesterday to ensure that they did not charge the government any extra interest in saying that the payments may have been delayed. So, the funds have been transferred. The funds c onsisted of $51.2 million, $50 million on the principal and $1.2 million on the half -year interest, as interest on the $50 million is payable twice a year. Therefore, as stated in the Statement, our annual interest expense will now reduce by $2.4 million, and gross debt will fall for the first time in over 20 years.
The SpeakerThe SpeakerSupplementary or new question?
Mr. Scott PearmanSo if it is due today, the Government is in fact complying with the contractual obligation, yes? Hon. E. David Burt: I think the learned Member would know the answer to that question. I am trying to under-stand what his point is. Maybe you will get to it in the …
Mr. Scott PearmanYes, second supplementary. I have been asked to clarify why I asked that question. The Government had portrayed this as if they were getting ahead of the game. But in fact they are doing what they were obliged to do, correct? Hon. E. David Burt: Mr. Speaker, as we see …
Yes, second supplementary. I have been asked to clarify why I asked that question. The Government had portrayed this as if they were getting ahead of the game. But in fact they are doing what they were obliged to do, correct? Hon. E. David Burt: Mr. Speaker, as we see again, they cannot help themselves. I can assure you, if the Government of Bermuda had to refinance this debt and did not have the funds because there was no money in the bank, they would be making a whole pile of noise. But they cannot even bring themselves to say, Job well done! The fact is, Mr. Speaker, that unlike the record of the One Bermuda Alliance, who said that they were going to borrow $800 million which would last their entire term of office and then went back to the bank to borrow more money three years later because th ey could not control the spending and layouts to the commitments of which they had, this Government has taken a different path, ensuring that we have the funds in place and are progressing toward a balanced budget. And may I remind the Honourable Member that if it was not for the pandemic and their failed Morgan’s Point project, which has cost the Government more than $200 million, the budget would have been well bal-anced and we would have had, Mr. Speaker, far lower interest rate payments than we do now. So the Honourable Member may wish to try to say, Oh, the Government isn’t doing anything. The fact is if we did not make this payment, if we had to roll over this debt, they would have been saying, They aren’t doing it. They cannot have it both ways, Mr. Speaker, but they try to do it every time.
The SpeakerThe SpeakerSecond question. QUESTION 2: MID -YEAR FINANCIAL UPDATE AND TABLING OF THE PRE -BUDGET REPORT AND REPORT OF THE FISCAL RESPONSIBILITY PANEL
Mr. Scott PearmanYes, yes. It appears I struck a nerve today. But there we are. Second question, Mr. Speaker. And I did not say the Government is not doing anything. I said the Government is doing what it is obliged to do. 234 15 December 2023 Official Hansard Report Bermuda House of …
Yes, yes. It appears I struck a nerve today. But there we are. Second question, Mr. Speaker. And I did not say the Government is not doing anything. I said the Government is doing what it is obliged to do. 234 15 December 2023 Official Hansard Report
Bermuda House of Assembly Second question, Mr. Speaker. Honourable Premier and Minister of Finance, this $50 million is coming out of the sinking fund. And in fact what happened is the Government borrowed more than was needed last time and set aside the $50 million being paid now. So do you agree that in fact the net debt, which is gross debt less the sinking fund, will be left unchanged by this action? Net debt will be left unchanged?
The SpeakerThe SpeakerPremier. Hon. E. David Burt: Mr. Speaker, that was mentioned in my Statement.
The SpeakerThe SpeakerSupplemental. Yes. SUPPLEMENTARY
Mr. Scott PearmanThe fact that it was mentioned in your Statement, do you agree that net debt is unchanged? [Inaudible interjections]
The SpeakerThe SpeakerI think the fact that it was included in the Statement speaks for itself.
Mr. Scott PearmanWith respect, Mr. Speaker, I can include something in a Statement —does not say I agree or disagree. I am inviting [the Honourable Premier] to agree with the Statement. [Inaudible interjections]
The SpeakerThe SpeakerI would want to think that the Statements that the Ministers bring here are Statements that they are in agreement with. It is their Statement. It is their Statement that they have drafted and brought to the House. [Inaudible interjections]
The SpeakerThe SpeakerMembers! Members, Members. Thank you. I would want to think any Minister who is bringing a Statement here is bringing something to the House that they are in support of and are in agreement with.
Mr. Scott PearmanWell, thank you for clarifying the point that net debt has not actually been reduced. Thank you, Mr. Speaker. No further questions.
The SpeakerThe SpeakerThank you. Premier, the next question is also for you. It is from MP Dunkley. MP Dunkley, would you like to put your question? QUESTION 1: MID -YEAR FINANCIAL UPDATE AND TABLING OF THE PRE -BUDGET REPORT AND REPORT OF THE FISCAL RESPONSIBILITY PANEL Hon. Michael H. Dunkley: Good morning, …
Thank you. Premier, the next question is also for you. It is from MP Dunkley. MP Dunkley, would you like to put your question?
QUESTION 1: MID -YEAR FINANCIAL UPDATE AND TABLING OF THE PRE -BUDGET REPORT AND REPORT OF THE FISCAL RESPONSIBILITY PANEL
Hon. Michael H. Dunkley: Good morning, Mr. Speaker, and good morning to honourable colleagues. I thank the Honourable Premier for the Statement and the update today. A few questions to the Honourable Premier. Honourable Premier, I believe on page 2 of your Statement, the second paragraph, in bold as you talk about spending, it says, “ Spending has generally been kept under control . . .”. Can you give us some feedback on what the word “generally” means? Obviously, the Fiscal Responsibility Panel must have some concerns in that? But I do appreciate the update, and it is clear that there has been some effort and some success in getting expenses under control, by the report . But I would just like to know what concerns are raised so we can be aware of them for the future.
The SpeakerThe SpeakerThank you. Premier. Hon. E. David Burt: Mr. Speaker, it is lovely to see that at least some Members of the Opposition can recog-nise that progress is being made. So, I welcome the comments of the Honourable Member. What I would say, Mr. Speaker, is that this report was tabled …
Thank you. Premier. Hon. E. David Burt: Mr. Speaker, it is lovely to see that at least some Members of the Opposition can recog-nise that progress is being made. So, I welcome the comments of the Honourable Member. What I would say, Mr. Speaker, is that this report was tabled in this Honourable House for Members to read. It is available on the government website for persons to see. But I think the important point to note in this case is that unlike last year, where t he Fiscal Responsibility Panel said that they do not believe that the Government’s spending projections can be met (they said [the projections] were too aggressive) in making sure that we constrained our spending, in this year they admitted that they may not have been entirely accurate in what they thought and commended the Government for keeping spending in control while increasing revenues, leading toward deficit reduction. This is an independent report , so the Honour able Member is asking me to opine on why those persons said that. I know that there are Members who are in contact and they are perfectly happy to go ahead and reach out for clarification. This is a quote from the report that is from an independent body . And members of the public and also Members of the Honourable House can read it, as I know it is on all Members’ tablets.
The SpeakerThe SpeakerSupplementary or new question? Bermuda House of Assembly QUESTION 2: MID -YEAR FINANCIAL UPDATE AND TABLING OF THE PRE -BUDGET REPORT AND REPORT OF THE FISCAL RESPONSIBILITY PANEL Hon. Michael H. Dunkley: New question. I appreciate the answer from the Premier. And the Opposition will reach out and get some …
Supplementary or new question?
Bermuda House of Assembly QUESTION 2: MID -YEAR FINANCIAL UPDATE AND TABLING OF THE PRE -BUDGET REPORT AND REPORT OF THE FISCAL RESPONSIBILITY PANEL
Hon. Michael H. Dunkley: New question. I appreciate the answer from the Premier. And the Opposition will reach out and get some clarification, as the Premier suggested. Second question to the Honourable Premier: Honourable Premier, on page 2 and page 3 of your Statement you refer to $15 million being granted to the Hospitals Board in additional funding and $16 million being granted in this fiscal year for additional funding to the Bermuda Hospitals Board. Honourable Premier, going forward in the budget for next year, what is going to be done to alleviate the financial challenges within the hospital? It is clear that there are sustainability issues as far as hospital financing is concerned, and we must get it right. Appreciate any update the Premier can give. Specific question: How are we going to address the hospital funding next year to make sure that the block grant meets the funding required, or what additional measures will be taken to meet those financial challenges?
The SpeakerThe SpeakerPremier. Hon. E. David Burt: Thank you, Mr. Speaker. I appreciate the question. I am just chuckling to myself as I remember when we used to sit in another place and there were questions asked about the future. And we used to, you know, bring out the fake crystal ball. …
Premier.
Hon. E. David Burt: Thank you, Mr. Speaker. I appreciate the question. I am just chuckling to myself as I remember when we used to sit in another place and there were questions asked about the future. And we used to, you know, bring out the fake crystal ball. I cannot state as to where we will be in February. But I do know the Honourable Minister of Health will happily update the House when we get to the Budget Debate and budget matters related to that. I know that the Ministry of Health is currently analysing those particular matters. These funds, as stated in the [Statement], were funds that were not paid previously to the hospital but were due to the hospital. And we wanted to make sure they got that particular cash. We made sure we pro-vided that particular cash while, as stated, rema ining inside of budget targets. And as a reminder for the listening public, though we did give an additional $15 million which was unbudgeted last year, our deficit came down and was significantly below the estimates that were given to the House last year. And that is a testament to the sound fiscal management, the tight expense controls of which the Government has continued to maintain. And I am sure that the Honourable Minister of Health will update this Honourable House on the matters related to the fiscal sustainability at the Bermuda Hospitals Board, and I am certain there will be a very long and large debate on that in the budget session.
The SpeakerThe SpeakerThank you. Supplementary or third question? Hon. Michael H. Dunkley: Supplementary, Mr. Speaker.
The SpeakerThe SpeakerYes. SUPPLEMENTARIES Hon. Michael H. Dunkley: Thank you, Honourable Premier. For that supplementary question, Mr. Speaker, the Premier says that we will have a long debate during the budget next year. So a question in advance, because we talked about this a bit in Question Period last year: How was …
Yes.
SUPPLEMENTARIES
Hon. Michael H. Dunkley: Thank you, Honourable Premier. For that supplementary question, Mr. Speaker, the Premier says that we will have a long debate during the budget next year. So a question in advance, because we talked about this a bit in Question Period last year: How was it overlooked that money that was budg-eted for the hospital was not paid in the appropriate timeframe?
The SpeakerThe SpeakerPremier. Hon. E. David Burt: Mr. Speaker, in the spirit of goodwill amongst men in the Christmas season, I am not going to try to throw stones at things which may or may not have happened prior to my returning to the Ministry of Finance. Nonetheless, what I will say …
Premier. Hon. E. David Burt: Mr. Speaker, in the spirit of goodwill amongst men in the Christmas season, I am not going to try to throw stones at things which may or may not have happened prior to my returning to the Ministry of Finance. Nonetheless, what I will say is that those funds have now been paid. And we are making sure . . . There are difficult decisions that have to be made, Mr. Speaker. We have to deal with cash. People are saying that we were inside of a pandemic. And so it is not something that the . . . I know what the O pposition is trying to get at. The reality is that the funds have now been paid. The hospital does have their money that they were supposed to get underneath the block grant, and they have been made whole. During the pandemic, the money may not have been there. There were fewer people who were employed. Therefore, there was a shortfall in the money that went to the hospital. And the question is whether or not the hospital took up that shortfall or the Gover nment made up the shortfall from general revenues and not from health insurance receipts. We have made a decision to fund that money and to take it out of the general fund to ensure that the hospital can continue to operate. And I think that all persons would recognise that that is the right and correct decision, especially when the Opposition is saying that the Government should meet its commitments. In this case, we have. It was a difficult decision to make, but we made sur e that we met those commitments because we believe that it is right and proper to do. Because everyone believes that our only hospital should be properly funded.
The SpeakerThe SpeakerSecond supplementary or third question? Hon. Michael H. Dunkley: Second supplementary. 236 15 December 2023 Official Hansard Report Bermuda House of Assembly The Speaker: Go ahead. Hon. Michael H. Dunkley: A hundred per cent support the Premier; the hospital must be funded. We have spo-ken about this for extended periods …
Second supplementary or third question?
Hon. Michael H. Dunkley: Second supplementary. 236 15 December 2023 Official Hansard Report
Bermuda House of Assembly The Speaker: Go ahead.
Hon. Michael H. Dunkley: A hundred per cent support the Premier; the hospital must be funded. We have spo-ken about this for extended periods of time, Mr. Speaker. And in the spirit of goodwill, I will not carry that any further. But I caught the stone that was directed in that dir ection, Mr. Speaker. Second supplementary question: Does the Honourable Premier believe that the block grant is the way forward for funding of the hospital?
The SpeakerThe SpeakerPremier. Hon. E. David Burt: Mr. Speaker, there is no stone. That is just reality. Making decisions in finance is diffi-cult. Making sure that you meet budget targets, having adequate cash and governing a country and running a ministry in a pandemic is difficult. But the record of thi s …
Premier.
Hon. E. David Burt: Mr. Speaker, there is no stone. That is just reality. Making decisions in finance is diffi-cult. Making sure that you meet budget targets, having adequate cash and governing a country and running a ministry in a pandemic is difficult. But the record of thi s Government, whether it is myself as Minister of Finance or the prior Minister of Finance, shows that we have consistently met our budget targets by being fiscally responsible. So, on the matter of the block grants and other issues going forward, I will refer to the earlier statement of which I made. And that earlier statement is that I am certain that those matters we fully discussed and debated in the budget time. And if the Ho nourable Member does have specific questions for the Minister of Health or wishes to meet with the Honourable Minister of Health, I am sure if he sends a question or makes that request, the Honourable Minister of Health would be happy to meet with the Hono urable Member to discuss the matters of which he has. As I said in an earlier answer, those matters are currently being reviewed and they will be brought to the House when they are complete.
The SpeakerThe SpeakerThird question? QUESTION 3: MID -YEAR FINANCIAL UPDATE AND TABLING OF THE PRE -BUDGET REPORT AND REPORT OF THE FISCAL RESPONSIBILITY PANEL Hon. Michael H. Dunkley: Yes, Mr. Speaker. Thank you. Mr. Speaker, the Honourable Premier on page 4 of his Statement refers to the Government pledge of $7.5 million …
Third question?
QUESTION 3: MID -YEAR FINANCIAL UPDATE AND TABLING OF THE PRE -BUDGET REPORT AND REPORT OF THE FISCAL RESPONSIBILITY PANEL Hon. Michael H. Dunkley: Yes, Mr. Speaker. Thank you. Mr. Speaker, the Honourable Premier on page 4 of his Statement refers to the Government pledge of $7.5 million in back taxes to be collected in this fiscal year and updates this Honourable House that so far $15.7 million in back taxes have been collected through November. I would like to congratulate the Office of the Tax Commissioner and the Government for making this happen. Certainly, that is welcome news. If people owe money, [they] need to pay it, because if [they] do not pay it, other people are covering for those who run from their responsibilities. I know there is hardship that goes around in the community, but we need to collect taxes. So to the Honourable Premier, with the job being done with some good results, what are the expectations going forward from this Government on the col-lection of back taxes?
The SpeakerThe SpeakerPremier. Hon. E. David Burt: Mr. Speaker, I will just state for the Honourable Member that when the Ministry of Finance does its analysis, as we are going through the budget session, we will make further commitments and budget announcements will be made. I accept the congratulations from the Opposition. …
Premier. Hon. E. David Burt: Mr. Speaker, I will just state for the Honourable Member that when the Ministry of Finance does its analysis, as we are going through the budget session, we will make further commitments and budget announcements will be made. I accept the congratulations from the Opposition. The fact that we had set a target —and for full note and knowledge the original target that we set was $10 million—it was stated by the Tax Commissioner that that may be too aggressive. So, we reduced it to $7.5 milli on. But the fact that we are up to $15.7 million through the month of November is testament to the investments that have been made in the Office of the Tax Commissioner in the work that has been done in the Ministry of Finance by the prior Finance Minister and continues now to make sure that we are collecting back taxes. So, what we have seen here is a continued effort to address these particular challenges. And what we will do is update the public on new targets and those targets we set out in the Budget Statement that will be delivered in February. But it is unquestioned that the investments that have been made have made it easier and better and more efficient for the department to collect back taxes. And we are living up to our commitments that have been made to the taxpayers of this country, signif icantly international business who raise this issue every year. And this Government once again is demonstrating that it can deliver.
The SpeakerThe SpeakerThank you. Supplementary? SUPPLEMENTARY Hon. Michael H. Dunkley: Thank you for that succinct answer by the Honourable Premier. Mr. Speaker, my last question, supplementary (well, depending on how the Honourable Premier an-swers it), is, What is the outstanding balance of unpaid collectible taxes at the present time?
The SpeakerThe SpeakerPremier. Hon. E. David Burt: Mr. Speaker, I do not have that information off the top of my head.
The SpeakerThe SpeakerYes. Bermuda House of Assembly Hon. Michael H. Dunkley: Will the Premier endeavour to obtain it for the House? Hon. E. David Burt: Mr. Speaker, I am sure that those matters will be covered in the Budget Statement. But if the Honourable Member wants to submit a specific Parliamentary Question, …
Yes.
Bermuda House of Assembly Hon. Michael H. Dunkley: Will the Premier endeavour to obtain it for the House?
Hon. E. David Burt: Mr. Speaker, I am sure that those matters will be covered in the Budget Statement. But if the Honourable Member wants to submit a specific Parliamentary Question, we will endeavour to get the research done in advance of the Budget Statement and provide it .
The SpeakerThe SpeakerThank you. Hon. Michael H. Dunkley: I am happy to submit a Parliamentary Question, but I have to wait until the Budget Debate next time. I am asking the Honourable Premier if maybe I could send an email to the Honourable Premier and he could remind Members in the Office …
Thank you.
Hon. Michael H. Dunkley: I am happy to submit a Parliamentary Question, but I have to wait until the Budget Debate next time. I am asking the Honourable Premier if maybe I could send an email to the Honourable Premier and he could remind Members in the Office of the Tax Commissioner to submit the balance? I would be happy to do it that way.
[Inaudible interjection]
The SpeakerThe SpeakerOkay. Okay. The Premier gave a response to it. So, it will work from there. Okay? Thank you, Premier. Those were the only questions for you this morning. The next Statement that has questions is that from the Minister of Youth, Social Development and Seniors. Minister, MP Jackson has a …
Okay. Okay. The Premier gave a response to it. So, it will work from there. Okay? Thank you, Premier. Those were the only questions for you this morning. The next Statement that has questions is that from the Minister of Youth, Social Development and Seniors. Minister, MP Jackson has a question for you. MP Jackson.
QUESTION 1: CARICOM’S DRAFT GENDER STRATEGY
Ms. Susan E. JacksonThank you, Mr. Speaker, and good morning, Members and the listening public. I just had one question for the Minister. When she was reviewing and participating in the CARICOM draft Gender Strategy, were there any particular areas that the Minister felt would be most useful for Bermuda? Are there any …
Thank you, Mr. Speaker, and good morning, Members and the listening public. I just had one question for the Minister. When she was reviewing and participating in the CARICOM draft Gender Strategy, were there any particular areas that the Minister felt would be most useful for Bermuda? Are there any particular areas within the Str ategy that she has highlighted as being a priority for Bermuda?
The SpeakerThe SpeakerMinister. Hon. Tinee Furbert: Thank you, Mr. Speaker. I did mention in the Statement in regard to the actual thematic areas of the Gender Strategy, and it is really to make sure that Bermuda with her own terms of reference with our Gender Affairs Council is aligning with other jurisdictions …
Minister.
Hon. Tinee Furbert: Thank you, Mr. Speaker. I did mention in the Statement in regard to the actual thematic areas of the Gender Strategy, and it is really to make sure that Bermuda with her own terms of reference with our Gender Affairs Council is aligning with other jurisdictions as it relates to strategies for gender equality. So that would include those seven pillars that I mentioned of gender equality and social inclusion, freedom from violence, economic empowerment, good governance, access to health services, inclusive quality education, sustai nable natural resource management. Thank you, Mr. Speaker. The Speaker: Thank you. Supplementary?
The SpeakerThe SpeakerNo further questions. Thank you, Members and Ministers. That brings us to an end of the Question Period this morning. And we will now prepare to move on. CONGRATULATORY AND/OR OBITUARY SPEECHES
The SpeakerThe SpeakerLet me set the clock. Does any Member wish to speak to that? MP Swan.
Mr. Hubert (Kim) E. SwanYes. Good morning, Mr. Speaker. Mr. Speaker, I rise on congrats and obits to be associated with an obituary brought by the Deputy Speaker last week. It came to my attention through his obituary that Mr. David Ralston had passed away. And I felt certainly a huge welling in my …
Yes. Good morning, Mr. Speaker. Mr. Speaker, I rise on congrats and obits to be associated with an obituary brought by the Deputy Speaker last week. It came to my attention through his obituary that Mr. David Ralston had passed away. And I felt certainly a huge welling in my heart to as sociate myself with that, but more so to speak to Mr. David Ralston’s passing, which was very personal to me in that when I came home from university and worked at Castle Harbour, Mr. David Ralston was the most extraordinary golf course superintendent I had ever met and have ever met. He came to Bermuda from Scotland and assimilated with Bermuda like no other I have ever seen to such an extent that he took a workforce of migrant workers from the Azores and blended them in with workers in Tucker’s Town, Bermudians, in a harmonious way that a textbook could be written about. And his extraordinary methods meant that he had a Scottish – Portuguese –Azorean dialect that his workers could understand. Where persons who were golf course superintendents traditionally would drive the newest vehicle around maybe and go around and see, he rode that little bike around Castle Harbour and Tucker’s Town, no helmet, shorts in the winter. He had relationships with everybody through his connections, through both the Lodge and Rotary Club. He put on many charitable events down in the stables, which housed many cars in Tucker’s Town. Many black -tie events were held down at the Stables that rai sed thousands of dollars to help charities. He played football, as the Honourable Deputy Speaker spoke of, for St. George’s. And he was just a great man. But he was the person, Mr. Fixit in a way, in which if you had an industrial problem at management lev el, you went to him. And he would walk into the office down there to the GM and represent for many persons, all persons. And I just want his family to know that David Ralston was well respected and loved by many, 238 15 December 2023 Official Hansard Report
Bermuda House of Assembly including myself. And I just pray that his family will be comforted by words of his great contribution to Bermuda. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, Mr. Speaker. Does any other Member wish to speak? MP Dickinson, you have your three minutes.
Mr. Curtis L. DickinsonMr. Speaker, I will not require that much time. Mr. Speaker, I rise this morning to ask the House to convey hearty congratulations on the 98th birthday of Ms. Izola Harvey! Ms. Harvey, as many will know, was a member of the Progressive Group. And I would dare say part …
Mr. Speaker, I will not require that much time. Mr. Speaker, I rise this morning to ask the House to convey hearty congratulations on the 98th birthday of Ms. Izola Harvey! Ms. Harvey, as many will know, was a member of the Progressive Group. And I would dare say part of the group was responsible for the expansion of rights for all people of Bermuda to live equally. So I would ask that we send h er a note, especially this year in light of the fact that she lost her hus-band of 68 years earlier this year. Thank you, Mr. Speaker.
The SpeakerThe SpeakerSir, I think the whole House would be associated with that. Yes. MP Simmons, would you like your three minutes?
Mr. Jamahl S. SimmonsThank you. I would love to be associated with the remarks about my constituent, Ms. Izola Harvey, and join in the congratulations and gratitude for her contribution toward moving Bermuda forward and for helping make it a more equitable place. While I am on my feet I would also like …
Thank you. I would love to be associated with the remarks about my constituent, Ms. Izola Harvey, and join in the congratulations and gratitude for her contribution toward moving Bermuda forward and for helping make it a more equitable place. While I am on my feet I would also like to acknowledge and praise Ms. Tajuana Dean- Swan, the Head Mistress of Dalton E. Tucker Primary. I am sure many Members will be glad to associate themselves with the remarks I am about to say.
Mr. Jamahl S. SimmonsI had the pleasure of first meeting her [when I was] a newborn MP in 2014. And as many of my constituents’ children attend the school, we built a very strong relationship. And travelling up and down the Island, you would see many schools. And you were abl e to …
I had the pleasure of first meeting her [when I was] a newborn MP in 2014. And as many of my constituents’ children attend the school, we built a very strong relationship. And travelling up and down the Island, you would see many schools. And you were abl e to compare and contrast. And the leadership of Ms. Dean created an environment of love, of discipline, of structure and of community. And she will be truly missed, and her successor has truly big [shoes] to fill. Thank you, Mr. Spea ker.
The SpeakerThe SpeakerThank you. Would any other Member wish to make a contribution at this time? MP Cannonier.
Mr. L. Craig CannonierYes. Thank you, Mr. Speaker, and good morning, colleagues. I would just like to send condolences to the family of Steve Parkes, as you read in the paper, better known as “Carpenter.” We spent an extensive amount of time together trying to address the many challenges that we are having …
Yes. Thank you, Mr. Speaker, and good morning, colleagues. I would just like to send condolences to the family of Steve Parkes, as you read in the paper, better known as “Carpenter.” We spent an extensive amount of time together trying to address the many challenges that we are having with our youth. And he actua lly was part of the solution. It is sad to see that he has suffered while trying to be in the midst of . . . being someone who would bring about a solution to the issues that we are facing with our youth. We had set aside buildings that we were looking to renovate, and we were going to use those buildings for a training ground for many of these youths. What the public may not be aware of is that also he was looking to renovate the building in St. George’s. If you had read in the paper, you would see where Sophia Cannonier is going to be moving down there, and [Mr. Parkes] was going to use that building as well, along with some of the individuals who were involved like Corin Smith and Gladwyn Simmons and the likes who have been trying to put together programmes for many years now. But we did spend quite a bit of time with Steve in being a part of the solution. So, it is really sad to see that he suffered and has passed away here under what I would say are horrific circumstances. And we need to send condolences to the family on the l oss of somebody who was trying to be a part of the solution. A good man. Thank you very much.
The SpeakerThe SpeakerThank you. Does any other Member wish to make a contribution? MP Lister, you have your three minutes.
Mr. Dennis Lister IIIGood morning to the listening audience, fellow colleagues. I would like to start off by associating myself with comments made by MP Jamahl Simmons in regard to Ms. Tajuana Dean. I declare an interest; she is family. But I did read that she had been educating for 38 years. That …
Mr. Dennis Lister IIIThirty -eight years is a long time to commit to being an educator and to make it to being a principal. So again, I just want to congratulate her on the 38 years of service that she put in to public educa-tion in Bermuda. Bermuda House of Assembly On that …
Thirty -eight years is a long time to commit to being an educator and to make it to being a principal. So again, I just want to congratulate her on the 38 years of service that she put in to public educa-tion in Bermuda.
Bermuda House of Assembly On that note, Mr. Speaker, yesterday the Great Christmas Carol -Off was held at the L. F. Wade International Airport.
Mr. Dennis Lister IIIBut I just want to congratulate and recognise all of the students and all of the different schools that participated. And I hope you will vote for those schools. I will declare my interest; I will be voting for Bermuda Institute. But congratulations to al l of the schools and …
But I just want to congratulate and recognise all of the students and all of the different schools that participated. And I hope you will vote for those schools. I will declare my interest; I will be voting for Bermuda Institute. But congratulations to al l of the schools and students who participated, that they did a good job. While I was at the airport, Mr. Speaker, many Bermudians are well known for being well -travelled. As small as we are, we get around. You can go to any country in this world and almost find a Bermudian and know a Bermudian who is there. On that note, Mr. Speaker, I also want to congratulate and declare my interest to my uncle, former Member of Parliament, Mr. Terry Lister, who also re-ceived recognition for being one of only 6,000- odd people on this earth to have received a certificate for visiting 100 countries in his lifetime. He received the certif-icate. I cannot remember the name of the exact organisation, but they keep track of those who have travelled to a minimum of 100 countries, and he reached that milestone recently. And he was aw arded that acknowledgement for — [Inaudible interjection]
Mr. Dennis Lister IIII would say I have not been on any of the trips with him yet. [Inaudible interjections and l aughter]
Mr. Dennis Lister IIIBut as I said, Bermudians are well travelled. And out of the 7 billion- odd people, only 6,000- odd people have reached that milestone of travelling to 100 countries on this earth. So again, I want to just recognise him for that achievement. And hopefully one day many more Bermudians …
But as I said, Bermudians are well travelled. And out of the 7 billion- odd people, only 6,000- odd people have reached that milestone of travelling to 100 countries on this earth. So again, I want to just recognise him for that achievement. And hopefully one day many more Bermudians can join in that achievement. I have lost track. I have made it to 20 or so countries, Mr. Speaker, but I have a long way to go to catch him up. But hopefully one day I might be able to join that prestigious group of people who have visited 100 countries at least, on this earth. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, MP. MP Ming, good morning. You have your three minutes.
Mrs. Renee MingGood morning, Mr. Speaker and listening audience. This morning I rise with a very heavy heart. St. George’s lost an icon, a legend today actually. Janet Smith was the wife of Ross Smith, former — [Inaudible interjection]
Mrs. Renee MingYes, Ross Smith . Anyone who knew Aunt Janet knows that she goes over and beyond within our community. She is de-pendable. She does not like to be out front. She works tirelessly behind the scenes. Anything in the community that is going on, Janet was there. She helped for …
Yes, Ross Smith . Anyone who knew Aunt Janet knows that she goes over and beyond within our community. She is de-pendable. She does not like to be out front. She works tirelessly behind the scenes. Anything in the community that is going on, Janet was there. She helped for two years with my feeding programme even on the days when she was not feeling well. She assisted with the Walk to Calvary. She was an active member in Richard Allen AME Church. And in our small but ever -tight community of St. George’s, I can tell you that she will be missed. And yes, the fact that she was a nurse, she gave even so much more of herself to community be-cause we have had constituents who have needed things redressed and they could not get the district nurse to come. Janet would be the one that you could call and s he would come. And she would offer her services free of charge, never doing anything but loving and encouraging. So today St. George’s has lost a legend, a great person. I know what she would want us to do, and that would be to stay encouraged. Because I know for me she encouraged me. She sent me a message every single day. You know, it is unfortunate. She will be missed. But she will also be remembered.
Mrs. Renee MingAnd I hope that we can be half the person that she was in terms of how she encouraged and the things that she did within her community. I know that some of what I am today . . . because she was part of what I would call my …
And I hope that we can be half the person that she was in terms of how she encouraged and the things that she did within her community. I know that some of what I am today . . . because she was part of what I would call my village. And we often talked abou t how we treat and act within our communities. Mr. Speaker, I would also like to just do a congratulatory thing. Last week I attended the RAA, and in St. George’s town again, Seniors Christmas Lunch. Excellent time, well organised. We have some active seniors out there. I would like to associate MP Sw an with those comments. He actually busted out in a little tune. (Better keep his day job.)
[Laughter]
Mrs. Renee MingAnd the Corporation of St. George’s hosted the Santa Comes to Town, another successful event, a draw into the community. I also want to thank the Corporation of St. George’s workers because if you have not visited St. 240 15 December 2023 Official Hansard Report Bermuda House of Assembly George’s …
And the Corporation of St. George’s hosted the Santa Comes to Town, another successful event, a draw into the community. I also want to thank the Corporation of St. George’s workers because if you have not visited St. 240 15 December 2023 Official Hansard Report
Bermuda House of Assembly George’s and had a look at the lights down there, then you are truly missing it. There is nowhere else in the Island that looks half as fabulous as St. George’s does right now.
[Inaudible interjections]
Mrs. Renee MingSo if you have not visited, and I hope the listening audiences hear, you can come in, you can have a visit of the town. And also you can visit the Winter Wonderland at Somers Gardens. So, Mr. Speaker, on that note, thank you.
The SpeakerThe SpeakerThank you, MP Ming. ANNOUNCEMENT BY THE SPEAKER HOUSE VISITOR
The SpeakerThe SpeakerBefore I acknowledge MP Simmons - Wade, I would just like to acknowledge that in the Gallery this morning we have former Senator Perinchief. Phil Perinchief, it is good to see you in the House this morning. Good. [Congratulatory and/or Obituary Speeches, continuing]
The SpeakerThe SpeakerMP Simmons -Wade, you have your three minutes.
Mrs. Ianthia Simmons- WadeGood morning, Mr. Speaker and the listening public. I would like to give congratulations over some of the Christmas programmes this year. Vernon Temple’s Sunday School programme brought me actually to tears to see the young people who are still going to church and seeing the grandmothers and grandparents, aunts …
Good morning, Mr. Speaker and the listening public. I would like to give congratulations over some of the Christmas programmes this year. Vernon Temple’s Sunday School programme brought me actually to tears to see the young people who are still going to church and seeing the grandmothers and grandparents, aunts and everyone who came to support them. I would also like to congratulate Bright Temple on their candlelight service which was held on Sunday. Congratulations today, although I missed it, to Purvis Primary schoolchildren who are carolling around in Warwick. They went to homes, they went to Lorraine Rest Home. They also went to anyone they could find walking around, doing their “Jingle Bells.” And that was good because today was the last day of school. And because it rained yesterday, they said they were going to give up their Christmas party and still go and do the neighbourhood.
Mrs. Ianthia Simmons -WadeI would also like to congratulate Summerhaven on their Christmas event which was held last night. They have been doing this for the last almost 40 years, 22 years of which I was there to support them. They had a great support from the community, not just individual’s families who …
I would also like to congratulate Summerhaven on their Christmas event which was held last night. They have been doing this for the last almost 40 years, 22 years of which I was there to support them. They had a great support from the community, not just individual’s families who were there, but also individual’s families who had lived there and have passed. Now, Mr. Speaker, I had basically said before that I would always give congratulations to my seniors who are over the age of 65. It is interesting because I have 1,266 constituents. I have 448 seniors in my constituency , which is 35 per cent of the [constituency]. So birthday wishes Cora Wards, who went 89; birthday wishes to George Hopkins, who went 70; and William Mayo, who went 75. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, MP. Does any other Member wish to make a contribution? MP Foggo, you have your three minutes.
Ms. Lovitta F. FoggoGood day, Mr. Speaker. Good day to the House, and good day to the listening public. First, I would like to be associated with the remarks from MP Renee Ming in expressing condolences for Janet Smith, who in many ways became a matriarch in the St. George’s area. She was …
Good day, Mr. Speaker. Good day to the House, and good day to the listening public. First, I would like to be associated with the remarks from MP Renee Ming in expressing condolences for Janet Smith, who in many ways became a matriarch in the St. George’s area. She was known for her service. I would also like to be associated with the remarks for the St. George’s Corporation and the excellent work that they do in making what people try to call (St. George’s) a ghost town, but re- creating and bringing youth, vitality and all of that back to St. George’s where everything began from the get -go. And we are winning Cup Match next year. [Inaudible interjections and laughter]
The SpeakerThe SpeakerI think we have heard that wish a few times. [Inaudible interjections and laughter]
Ms. Lovitta F. FoggoSo, Mr. Speaker . . . But I do stand today to give congratulatory remarks to two great schools in the eastern area —East End Primary for an excellent concert yesterday evening, and St. David’s Primary for another first -class Christmas concert. Both schools are small, but let me say …
So, Mr. Speaker . . . But I do stand today to give congratulatory remarks to two great schools in the eastern area —East End Primary for an excellent concert yesterday evening, and St. David’s Primary for another first -class Christmas concert. Both schools are small, but let me say this: They are both mighty. Not only do they turn out excellent students, but they also— also whenever they do anything, they do it with a bang. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, MP Foggo. MP Caines, would you like to have your three minutes? Go right ahead.
Mr. Wayne CainesI would like to ask that a letter of condolences be sent to the family of Kaelon Jamal Bermuda House of Assembly Charles Ellsworth Furbert. He was a resident of Cedar Park, died in his 53rd year. We attended the Prospect Primary School together. In our community, he was one …
I would like to ask that a letter of condolences be sent to the family of Kaelon Jamal
Bermuda House of Assembly Charles Ellsworth Furbert. He was a resident of Cedar Park, died in his 53rd year. We attended the Prospect Primary School together. In our community, he was one of our community DJs. Everyone got along with him very well, a significant loss to our community. And on behalf of constituency 14 and the Progressive Labour Party, I ask that a letter of love and support be sent to his family. In congratulations, I would like to acknowledge the Prospect Primary School. My alma mater, the school is led by Dr. Holly Richardson. She has been at Prospect Primary, and you see the breadth and the excellence in her leadership. I had the privilege of attending their Christmas play this year. Just to see all of the families so excited, lined up outside, eagerly waiting to get inside. The children, they were turned out immaculately. Mr. [Rashaun] Bean is their music teacher. Just to see him take all of the primary years through the beautiful songs. He had a bell choir. Ms. Furtado, she also was one of the teachers who led out. I would like a letter of congratulations not only to be sent to the head teacher and the two teachers whom I mentioned, but to the entire staff. And I would like to acknowledge all of the parents who made sure that the young people learnt their parts and that they were on time and that they were immaculately turned out. It was such a community -based event. But it was good to see a school that was inclusive. The special needs students, the academic students, everyone was put together in a play that highlighted the importance of Christmas and the importance of our work-ing together as a community. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, MP Caines. Does any other Member wish to make— Minister Weeks, you have your three minutes. Hon. Michael A. Weeks: Thank you, Mr. Speaker. Good morning to you.
The SpeakerThe SpeakerGood morning. Hon. Michael A. Weeks: Mr. Speaker, I would like to start off my remarks by associating myself with the Member from constituency 14 who spoke of Kaelon Furbert. He was a person whom I have known for a long time. And like the MP said, Kaelon— [Inaudible interjection] …
Good morning.
Hon. Michael A. Weeks: Mr. Speaker, I would like to start off my remarks by associating myself with the Member from constituency 14 who spoke of Kaelon Furbert. He was a person whom I have known for a long time. And like the MP said, Kaelon—
[Inaudible interjection]
Hon. Michael A. Weeks: No, no. That is a Central guy. Yes. Central is where it all began, Mr. Speaker. I will put those who do not know.
The SpeakerThe SpeakerGo ahead. [Laughter] Hon. Michael A. Weeks: But Kaelon Furbert was really, really the neighbourhood DJ. And he is going to be a great miss. Mr. Speaker, I also want to be associated with the remarks for Steve Parkes. Unfortunately, he is the fourth murder in Bermuda this year. I …
Go ahead.
[Laughter] Hon. Michael A. Weeks: But Kaelon Furbert was really, really the neighbourhood DJ. And he is going to be a great miss. Mr. Speaker, I also want to be associated with the remarks for Steve Parkes. Unfortunately, he is the fourth murder in Bermuda this year. I did not know Mr. Parkes personally, but I knew his wife and his sons, you know. And they were just eulogising his w ife’s father just on Friday, Friday gone. And the following Monday her husband was brutally shot and murdered. So my heart goes out to the Parkes family. And like [Honoura-ble Member] Cannonier said, Mr. Parkes was one of those gentlemen who was trying to be a part of the solution in addressing the current behaviour that we are facing as a country. Mr. Speaker, on a positive note, I want to add before I sit down that Harrington Sound Primary School was also in this carolling contest at the airport. And it would be remiss of me not to get my vote and —
[Inaudible interjections and laughter ] Hon. Michael A. Weeks: And like others have said, I cast my vote down at Harrington Sound Primary for ob-vious reasons, Mr. Speaker. [Laughter and inaudible interjections ]
Hon. Michael A. Weeks: All right? But before I take my seat, Mr. Speaker, as a St. George’s transplant right now, before I sit down I must associate myself with the remarks from the MP from constituency 1 and talk about the lights down at St. George’s and down the square. They are very beautiful, Mr. Speaker. And those who have not seen it, I would suggest that you take a drive down there during this holiday season. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, Minister. Does any other Member wish— Government Whip, Mr. Tyrrell, you have the floor.
Mr. Neville S. TyrrellThank you, Mr. Speaker, and good morning to you and colleagues. Mr. Speaker, in the first instance I ask that condolences be sent to the family of the late Lucille May Evans of Lightbourne Drive in Warwick. Ms. Evans obviously was a constituent of mine and also a friend of …
Thank you, Mr. Speaker, and good morning to you and colleagues. Mr. Speaker, in the first instance I ask that condolences be sent to the family of the late Lucille May Evans of Lightbourne Drive in Warwick. Ms. Evans obviously was a constituent of mine and also a friend of mine as well, as we had many personal chats. So, I would ask that condolences specifically be sent to her daughter Lisa and her grandson Nizhii, who certainly will miss her. She came from a very, very large family, so I am sure others will miss her as well. And I should also mention that she had a connection with the Salvation Army. So she was widely, widely known. One of the things about Ms. Evans was very comical. Whenever we met, she either started off with this quote or ended with this quote. And I would like to 242 15 December 2023 Official Hansard Report
Bermuda House of Assembly say it, Mr. Speaker, if you do not mind. She would say, Peace in the heart and peace in the head. And as I said, I do not know where she got it from, but she would always say it to me whenever we met. On a lighter note, Mr. Speaker, I would ask that congratulations be sent, because it is the season for candlelight services, to the Warwick United Holiness Church also in Warwick, under the leadership of my good friend, Dr. Evroyd Weeks and Lady Weeks, who had their candlelight service on Sunday, Sunday gone. And because I was at the candlelight service in Devon-shire, I did not attend. But I was told by several of the neighbours in my constituency that it was well attended and a very good evening was had by all. So, I do congratulate him and his congregation. Thank you very much, Mr. Speaker.
The SpeakerThe SpeakerThank you, Government Whip, Mr. Tyrrell. Does anyone else wish to make a contribution at this time? MP Anthony Richardson. I see you jump to your feet. You have your three minutes.
Mr. Anthony RichardsonSure, Mr. Speaker. Others say it, but I am not going to take my three minutes today; that is for sure. I want to add my compliments, though, to all of the schools that participated at the Skyport (I want to call it) schools challenge. I actually was present yesterday. …
Sure, Mr. Speaker. Others say it, but I am not going to take my three minutes today; that is for sure. I want to add my compliments, though, to all of the schools that participated at the Skyport (I want to call it) schools challenge. I actually was present yesterday. And what was amazing is that as you drove up, the parking lot was full. And the first question was, Well, what is going on? I mean, you go inside, the children— and they were young children, right? And what was amazing was their tremendous energy. And what added to it was that they were there at a time when the actual airport was full. People w ere leaving. So it was really a treat to see how they were able to entertain the departing passengers in such a tremendous way. And as you know, when young people are involved, all of the parents are there. So you have all of the cameras going click, click, click. Then the passengers actually cheered when they finished singing, which made it even more so. And I will say Mr. Aaron Adderley is the President of Skyport, and I was talking to him in that they had a significant plan whereby the children were bused to the airport. They then actually received free lunch before they went back. So the children of course were tremendously overjoyed. And clearly, though, I will also add my congratulations to Summerhaven, Harrington Sound Primary School for what they are doing in the community as they actually enrich the community by the people whom they serve. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, MP Richardson. Does any other Member wish to make a contribution at this time? None other. Before we move on, I would just like to add a couple of comments to some of the remarks that were made. First of all, I would like to start off with …
Thank you, MP Richardson. Does any other Member wish to make a contribution at this time? None other. Before we move on, I would just like to add a couple of comments to some of the remarks that were made. First of all, I would like to start off with supporting the remarks made by MP Dickinson this morning in reference to Mrs. Harvey, who celebrated her 98 th birthday. And much can be said about the contribution that she and the organisation that she is associated with have done to bring Bermuda forward in the way that the accomplishments, as they started, seemed almost impossible in some areas. But through their diligence and commitment it was accomplished. Mrs. Harvey has been one of those figures who has been in my life for as long as I can remember. So, I give her my best wishes today in reaching this milestone of 98. Also, to the comments that were made from MP Jamahl Simmons for Ms. Dean, former Principal at Southampton Glebe, you know, we grew up at a time when extended family was a regular practice of how we grew up. And Ms. Dean was part of that extended family in my household. She was a cousin, but she grew up in my house quite often. And I am pleased with the con-tribution that she has been able to give to Bermuda, and she is a leading figure in our education system, and the impact that she has had on many young l ives. So, I support the congratulations that have been extended to her. And last, on a sad note, to the Smith family in St. George’s for the passing of Janet Smith. When I first became involved in this political circle, her husband, Ross, was one of those who were very active in the East End. And I got to build a good relationship and friendship with Ross through that, and I recognise the contribution that he and his wife together have made in the community. And I just want to express my condolences on the loss of their mother to the children and grandchildren as well. With those remarks, we will move on.
MATTERS OF PRIVILEGE
The SpeakerThe SpeakerThere are none. PERSONAL EXPLANATIONS
The SpeakerThe SpeakerThere are none. NOTICE OF MOTIONS FOR THE ADJOURNMENT OF THE HOUSE ON MATTERS OF URGENT PUBLIC IMPORTANCE
The SpeakerThe SpeakerThere are none. INTRODUCTION OF BILLS GOVERNMENT BILLS B ermuda House of Assembly The Speaker: We have two Bills to be introduced this morning. And the Premier will introduce the first. Actually, both Bills are Premier’s. BILL WITHDRAWN [Standing Order 48] CORPORATE INCOME TAX ACT 2023 Hon. E. David Burt: …
There are none.
INTRODUCTION OF BILLS
GOVERNMENT BILLS
B ermuda House of Assembly The Speaker: We have two Bills to be introduced this morning. And the Premier will introduce the first. Actually, both Bills are Premier’s. BILL WITHDRAWN [Standing Order 48] CORPORATE INCOME TAX ACT 2023 Hon. E. David Burt: Thank you very much, Mr. Speaker. Mr. Speaker, under the provisions of Standing Order 48, I move to withdraw the Bill entitled the Cor-porate Income Tax Act 2023 that was tabled on Friday, December 8, 2023. [ Motion carried: Corporate Income Tax Act 2023 was withdrawn.]
The SpeakerThe SpeakerYes. SUSPENSION OF STANDING ORDER 29(1) Hon. E. David Burt: Thank you, Mr. Speaker. Mr. Speaker, I am introducing the following Bill, which according to section 36(3)(a)(i) of the Bermuda Constitution requires the Governor’s recommendation so that it may be placed on the Order Paper: the Investment Business Amendment Act …
Yes. SUSPENSION OF STANDING ORDER 29(1) Hon. E. David Burt: Thank you, Mr. Speaker. Mr. Speaker, I am introducing the following Bill, which according to section 36(3)(a)(i) of the Bermuda Constitution requires the Governor’s recommendation so that it may be placed on the Order Paper: the Investment Business Amendment Act 2023. And I will move that Standing Order 29(1) be suspended so that it may be taken up at a later point in the meeting. [ Motion carried: Standing Order 29(1) suspended.)
The SpeakerThe SpeakerThank you. BILL FIRST READING INVESTMENT BUSINESS AMENDMENT ACT 2023 Hon. E. David Burt: Thank you, Mr. Speaker. Mr. Speaker, I am introducing the following Bill for its first reading so that it may be placed on the Order Paper for the next day of meeting: the Investment Busi-ness Amendment …
The SpeakerThe SpeakerThank you. Members, that brings us to the covering of all of the Bills to be introduced today. NOTICE OF MOTIONS
The SpeakerThe SpeakerThere are none. ORDERS OF THE DAY The Speaker: It has been agreed by both sides that there will be an adjustment to the order. Items 3 and 4 will be done as 1 and 2. And we will start with item 3 as number 1, and that is the …
There are none. ORDERS OF THE DAY The Speaker: It has been agreed by both sides that there will be an adjustment to the order. Items 3 and 4 will be done as 1 and 2. And we will start with item 3 as number 1, and that is the consideration of the Tourism Investment (Ariel Sands) Order 2023 in the name of the Junior Minister of Tourism, Culture and Sport. Junior Minister Swan.
Mr. Hubert (Kim) E. SwanMr. Speaker, I move that consideration be given to the draft Order entitled Tourism Investment (Ariel Sands) Order 2023 , proposed to be made by the Minister responsible for Tourism under section 3 of the Tourism Investment Act 2017 with the written agreement of the Minister of Finance in exercise …
Mr. Speaker, I move that consideration be given to the draft Order entitled Tourism Investment (Ariel Sands) Order 2023 , proposed to be made by the Minister responsible for Tourism under section 3 of the Tourism Investment Act 2017 with the written agreement of the Minister of Finance in exercise of the power conferred by section 5 of the Tourism In-vestment Act 2017.
The SpeakerThe SpeakerAre there any objections to the Junior Minister proceeding? None. Continue.
The SpeakerThe SpeakerI think you hit the points on that one. Continue.
Mr. Hubert (Kim) E. SwanThat was one of Dr. [Ewart] Brown’s one-m inute briefs. [Laughter] DRAFT ORDER TOURISM INVESTMENT (ARIEL SANDS) ORDER 2023
Mr. Hubert (Kim) E. SwanMr. Speaker, the purpose in bringing this Tourism Inves tment (Ariel Sands) Order 2023 before this Honourable House is to enable the grant of tax relief to the developers investing in the tourism product Ariel Sands Ltd., which is in the national economic interest of Bermuda. Mr. Speaker, I am …
Mr. Speaker, the purpose in bringing this Tourism Inves tment (Ariel Sands) Order 2023 before this Honourable House is to enable the grant of tax relief to the developers investing in the tourism product Ariel Sands Ltd., which is in the national economic interest of Bermuda. Mr. Speaker, I am pleased to invite this Honourable House to take this draft Order under consideration. Mr. Speaker, a key element of success in business is inves tment in the product to ensure it is always fresh and serves to meet the demands of the customer 244 15 December 2023 Official Hansard Report
Bermuda House of Assembly that the business aims to serve. Mr. Speaker, the hospitality business is no different. Destinations, hotels and attractions that seek to trade only on reputation can often lose their edge, proving to be more of what they were than what they need to be. Success in this ag-gressive and competitive tourism marketplace demands that every affiliated tourism business consistently stays cutting- edge. Mr. Speaker, the draft Order before the Honourable Members today presents that kind of investment in a product proposed to be made by a key tour-ism site in Bermuda. Ariel Sands Ltd. is a Bermudaregistered company and a joint venture between Michael Dougl as, Hollywood actor, and JTRE Holdings. JTRE Holdings was founded by Peter Korbač ka, who has been in the real estate market for over 25 years, operating in the United Kingdom, Central Europe and Asia. JTRE Holdings’ mission for Ariel Sands is to create a s uccessful tourism product that will create jobs, become an employer of choice, delight guests and most importantly increase awareness of Bermuda as an important destination for leisure and business. Further, Mr. Speaker, Ariel Sands Ltd.’s vision is to convert the 13.8- acre beachfront lot into a unique 131-key five -star lifestyle hotel resort consisting of 21 private five -star villas, 33 hotel suites and 30 condo hotel suites and amenities including pools and a pickleball court. This resort will be operated internationally by the internationally recognised operator, Kempinski Hotels. Mr. Speaker, Honourable Members will note that the terms of the draft Order are consistent with the Tourism Investment Act 2017 and provide relief sought for a period of 15 years. That relief is set out in clause 3 of the draft Order and again is consistent with the principal Act, which was amended in 2023 to permit the Minister responsible for Tourism greater discretion i n the granting of relief. Mr. Speaker, I would invite the attention of Honourable Members to clause 4 of the draft Order, which sets out the important means by which the hotel qualifies for the exemption from the employer’s share of the payroll tax, which is that a management trainee programme is in operation for Bermudians employed at the hotel. Mr. Speaker, Kempinski’s commitment is to support the management team of their hotels by ensuring that every training initiative optimises the quality of the guest service experience and drives profitability, and that the hotel team are professionally deve loped. Mr. Speaker, I remind this Honourable House that the Tourism Investment [Amendment] Act 2023 provides for full exemption from land tax for a new hotel for 10 years starting from the sixth year of the hotel’s opening date to [year] fifteen of the same date. Mr. Speaker, clause 4 sets out the important means by which Ariel Sands qualifies for this exemption, which is that 70 per cent of the hotel staff must be Bermudian in years six through fifteen. Mr. Speaker, Ariel Sands proposes a 60 per cent Bermudian s taff at the time of its opening in 2025, with the percentage increasing to the required 70 per cent with local training and incentives. Mr. Speaker, the advantages and benefits for the Bermudian economy by way of this Order include the increase in hotel beds, an increase in employment in tourism and the tourism- related sector, and promotion of Bermuda as a tourism destination to European and Asian markets. Mr. Speaker, I am pleased to commend this draft Order for the support of this Honourable House. Thank you.
The SpeakerThe SpeakerThank you, Junior Minister. Does any other Member wish to make a contribution? MP Cannonier, you have the floor.
Mr. L. Craig CannonierYes. Thank you, Mr. Speaker, and thank you to the Junior Minister for bringing good news actually for Bermuda. I was not quite sure which company the Honourable Member said. I just want to make sure, was he talking about Kempinski? Not Com . . . I do not know. …
Yes. Thank you, Mr. Speaker, and thank you to the Junior Minister for bringing good news actually for Bermuda. I was not quite sure which company the Honourable Member said. I just want to make sure, was he talking about Kempinski? Not Com . . . I do not know. He said “Com” something. Could he just clarify that for me? I was not quite sure.
The SpeakerThe SpeakerDo you want to just yield a minute so he can get clarification?
The SpeakerThe SpeakerJunior Minister, he is just trying to get a clarification on the name so that he can continue his presentation. [Inaudible interjection]
The SpeakerThe SpeakerThank you, Junior Minister, for that.
Mr. L. Craig CannonierYes. Thank you very much. And that is excellent news. Many of us would know this five-star establishment will do a fantastic job. Ariel Sands has been (my goodness!) the subject or on the table for this kind of development for many, many, many moons now. So it is good …
Yes. Thank you very much. And that is excellent news. Many of us would know this five-star establishment will do a fantastic job. Ariel Sands has been (my goodness!) the subject or on the table for this kind of development for many, many, many moons now. So it is good to see that there is some light at the end of the tunnel for this particular property, being a prime piece of real es tate that we believe can do good for Bermuda. I must say I am not sure about the timeframe. I did not hear much about when they plan on taking this on. So, it would be good to hear from the Junior Minister when this project will take place. I do take note in the [draft Order] that the request came in June. It is now six months later, so I am not sure if it is typical for it to take that amount of time to approve something like this here. But it would be interesting to try and figure out why i t has taken at least
Bermuda House of Assembly half a year just to get this to the table now, understanding that quite frankly we need the rooms to get going here. And I would have thought . . . and there may be a legitimate reason for it, but I would have thought it would have been a matter of urgency to get these things up and going. But suffice to say I do want to thank the Honourable Member for his overview. It is good to hear what they plan on doing. What we would like to now understand a little better is when they plan on getting this going. I am sure that the public would like to know so that they can get themselves prepared— electricians, carpenters, you name it, labourers and the like, get prepared for a project like this here. I do not know the total cost of something like this here, how much it would take in manpower. But it would be nice to Bermudians there working to get it up and going. And of course in addition to that, the manning of the actual hotel once it is established. One of the challenges that the industry continues to have right now is getting Bermudians back into it. It almost appears as if we kind of walked away from it, now we are having to train and get people back into it. So, I am sure that the Minister will be working very closely with the relevant institutions, unions and the likes, to ensure that we can get as many people back into this industry as possible. I may have one question during Committee.
[Inaudible interjections]
The SpeakerThe SpeakerNo Committee. No Committee; consideration. Yes.
Mr. L. Craig CannonierOh, that is right. There is no Committee for this here. That is right, that is right. Yes. It is an Order, yes.
Mr. L. Craig CannonierSo, I will ask the question. I am still not convinced that when we state here that one of the conditions is that, you know, this place has to be 70 per cent manned by Bermudians within a few years. It seems a bit aggressive and just thrown out there. …
So, I will ask the question. I am still not convinced that when we state here that one of the conditions is that, you know, this place has to be 70 per cent manned by Bermudians within a few years. It seems a bit aggressive and just thrown out there. I do not know how we are making out with some of the other hotels in getting to that point. I do not believe we have been able to reach that point, quite frankly, with the hotels that have been built. But I could be wrong. It will be interesting to hear from the Minister whether or not that is the case.
Mr. L. Craig CannonierSo again, we stated when the Act was passed many moons ago from 10 years to 15 years (not many moons, not so long ago) that this would bring up for any new development and any renovations coming up that they would be seeking 15 years as well. So, one …
So again, we stated when the Act was passed many moons ago from 10 years to 15 years (not many moons, not so long ago) that this would bring up for any new development and any renovations coming up that they would be seeking 15 years as well. So, one of the challenges I have is that we were offering these concessions to these hotels. But yet another part of that, the sister to the hotels is Airbnb where we seemed to be taxing more of the Airbnbs now as we go forward, but yet the hotels are getting concessions that they have never seen before. So, I hope that the Minister will be taking a look at how we are working with the hotels as well as how we are working with Airbnbs to bring about some balance as to the taxation so that we can get as many rooms up and going and people are as successful as possible, and in addition to that Bermudians back into the industry. So really at the end of the day we support this. We would like to see this happen as soon as possible. And maybe we can get some answers from the Junior Minister on a few of the questions that I had. But I must say, at the end of the day we knew that ever yone would be coming and looking for the 15 years and the taxpayers are going to have to foot that bill. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, MP Cannonier. Does any other Member . . . MP Caines, would you like to make a contribution?
Mr. Wayne CainesMr. Speaker, I am excited to learn of this opportunity for our country. If we consider back in the 1980s, when we were a thriving tourism destina-tion, there was a Member of Government at the time . . . but then the 1920s , a then Minister of Tourism said, …
Mr. Speaker, I am excited to learn of this opportunity for our country. If we consider back in the 1980s, when we were a thriving tourism destina-tion, there was a Member of Government at the time . . . but then the 1920s , a then Minister of Tourism said, We have too many tourists in Bermuda. Our streets are too busy . We put a moratorium on new hotels in the 1980s, and then that moratorium was extended for an-other 10 years.
Mr. Wayne CainesThat same Minister said We do not want burgers -and-french- fries-type of business coming to Bermuda. We know directly thereafter we had it so good in Bermuda that we thought that this would continue forever. We saw Lantana, the Somerset Bridge Hotel, Sonesta Belmont, Glencoe, Horizons Inverurie, Elbow Beach, Waterloo …
That same Minister said We do not want burgers -and-french- fries-type of business coming to Bermuda. We know directly thereafter we had it so good in Bermuda that we thought that this would continue forever. We saw Lantana, the Somerset Bridge Hotel, Sonesta Belmont, Glencoe, Horizons Inverurie, Elbow Beach, Waterloo House, Harmony Hall, the Hamiltonian Hotel, Ariel Sands, Coral Island, Clearview, Marley Beach, Flamingo, White Sands Hotel, Palmetto Bay Hotel, Munro Cottages, Bermudiana Hote l, Mermaid Beaches, Longtail Cliffs, Nine Beaches and the Southampton Princess. All of those hotels are gone, and many of them are starting to come back. And now we start to see a redevelopment in tourism. Now, we have to understand when we talk about concessions what we are trying to do. This is an excellent time to see people investing in Bermuda. We 246 15 December 2023 Official Hansard Report
Bermuda House of Assembly see Michael Douglas and his family, who are a Bermudian family, who are investing in a waterfront property that is on a prime location. We see the Kempinski Hotels, a renowned group, now showing confidence in Bermuda and investing in Bermuda. We have the o pportunity with this hotel coming online, and by 2026 with the advent of the Southampton Princess, to have 2,500 beds in Bermuda. That will be just over 108 per cent over our 2019 hotel inventory. So what we are seeing, Mr. Speaker, with a number of hotel properties that are in the pipeline, Bermuda can now see that we are starting to look at a renaissance in tourism. This hotel at the Ariel Sands allows us to go, when the team at the BTA [Bermuda Tourism Authority], when the team at the Ministry of Transport, when the team at the Airport Authority start having conversations with the root planners for the ho-tel, we can talk about what the future looks like. We can point clearly to effigies of succes s around tourism, and we can point to what is happening at Ariel Sands. We can talk about what is happening at the Southampton Princess and down in your neighbourhood, Mr. Speaker, at the Cambridge Beaches —all developments. Cambridge Beaches is a property, Mr. Speaker, that is over 100 years old. They have a fan-tastic legacy. This year they have gone through major renovations. Their brand is growing from strength to strength. And we can see at the Ariel Sands that has an hist oric family connection with our country. Now with a name badge that will build this hotel, we have the opportunity to partner with specific legislation to give specific concessions. I like the fact that the concessions were just not given without consultat ion with the Minister of Labour, who understands that if we are build hotels for a very long time, our Bermudians citizens are able to go into the hotel industry and [in the past] were able to see from one dimension only. What we are seeing with the ability for us to go to middle management and go up through management that Bermudians can see from a very young age that they can come in as a bellman and rise through and become a general manager. That is something that the legislation enshrines. I think if we look in the Caribbean and concessions that have been given, this is something that is done throughout the Caribbean and is one of the reasons why we have seen a hotel investment that is growing very strongly. I think this bodes well for the f uture. We are looking at getting properties like the Elbow Beach and taking them off of the back burner and bringing the hotel bed inventory to making our tourism product stronger. Why is this important? Mr. Speaker, you know in another realm I wear a different hat as the Chair of the Bermuda Tourism Authority. We now are going out and selling this country globally. Our mantra is to go and tell people about the benefits, the good thi ngs to extol. This week we were on one of the Real Housewives shows. I know that you do not watch such a show, Mr. Speaker. But for those who do, the reach was over a few million homes. And that is where we are starting globally to go to different places. We recently went to a trade show in London. Bermuda had been absent from the trade show in London for over 10 years and people are starting to see us in the north east in our bread basket. And this is a string, a bow in our quiver. We believe that this is a legislation that bodes well for Bermuda. It covers all of the bases with making sure that it gives a sound commitment to the hotel industry that the Government is paying attention. It will give the necessary concessions. And it is balanced. There are levels of accountability in the legislation. I think this is an excellent opportunity for our country going forward, but more important this will allow us to marry in the work of our business community, the investors in Bermuda, the Bermuda Government, the Bermuda Hotel Owners Association, the Bermuda Hotel Association, the people who need employment in Bermuda. And we, if we continue to work hand in hand with this and our tourism, we can only continue to go from strength to strength as a destination with reference to tourism. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, MP Caines. Does any other Member wish to— MP Anthony Richardson.
Mr. Anthony RichardsonI am actually pleased to add a few comments to this conversation in the instance of what I consider to be raising the bar —raising the bar in the context of Bermuda having a good reputation for a good service. And I do specify that service is not servitude. It …
I am actually pleased to add a few comments to this conversation in the instance of what I consider to be raising the bar —raising the bar in the context of Bermuda having a good reputation for a good service. And I do specify that service is not servitude. It is interesting as I see in other arenas, I guess, that there is in many instances a focus on excellence of service. I have made the point before, and I will make it again that in the context of Bermuda on a pure dollar basis. We may be expensive. But expensive is actually relative, and it must be put in the context of value for money. So, the push is always that there is a base level of cost for Bermuda based upon the fact of our virtual isolation and how things have to get here. But people will still co ntinue to come if they perceive that what they are paying is worth what they are receiv-ing. In many instances now, I do see this on a more daily basis, and I certainly encourage others to understand that if you provide good service, then those who are receiving the service are more than happy to pay for that service. What happens sometimes,
Bermuda House of Assembly unfortunately, is if people are paying for a service that they do not believe is worth the value in that they may have (I guess what I will call) a poor attitude— it may be a poor presentation, maybe poor timeliness and those other things —that is what adds to a sense of this -is-notworth- that, as opposed to if it is done well, people are happy to make those payments. For those who may take staycations or be involved with others who come to the Island and try to make reservations, what is interesting is that sometimes some of the more expensive hotels in Bermuda are actually full when those that are less expensive are not full. And that is another representation of value for money in that if it is perceived that I am going to a hotel and I am getting all that I want . . . I would say I do not mind. But the amount that I pay is actually not as im-portant. And recognising (I will not call your name), but recognising the Honourable Member, the same thing applies for service in terms of whether you are providing . . . whether you are a waiter, whether you are an accountant, whether you are a lawyer, whatever you are doing, if the service you provide is deemed to be of value, then people do not mind paying. And I will smile and say also on that note that there was a reason for a Bermudian professional to identify in the newspaper what their rate was. And I will not call their name, but certainly the rate was $950 an hour. And guess what? The service is regul arly demanded. So the same thing applies in terms of, it is really about what you are receiving as opposed to what you are paying. So on that note I will say also, similar to the person who spoke before me, MP Caines, that I was also surprised that we are at a stage whereby we are considering granting Ariel Sands concessions. Not surprised in the context in and of itself, but I just did not realise that Ariel Sands was as actively advanced as it apparently is. It definitely bodes well. We know that Ariel Sands is certainly one of those private niche iconic hotels in the past. And it is more than gratifying to see that it is coming to the fore. The fact that it is coming to the fore now speaks to the fact that both the developer and the operator understand the economics of the hotel and are prepared to go forward, number one by putting their names to it, and number two by making the investment and putting the effort into what is required to get it to this stage. Because clearly it is not an overnight decision to decide to come to Bermuda and then to do all of the work and spend the money necessary to get it to that stage. So, I will say again that I am pleasantly surprised that we are at this stage. In the context of the actual operator or the name, the Junior Minister has mentioned already it is Michael Douglas’ family name. And we know that sometimes what happens is the name recognition also adds to the value proposition. So, it will be interesting to see how the hotel finally progresses and what the end product will be. I note in the presentation of the Junior Minister that the intention (if I am not mistaken, MP Swan) is that it will be a five- star hotel. And that even speaks volumes because just the fact that it aims to be labelled as a five- star hotel indicates that they intend to provide a value to support what I am sure is going to be not an inexpensive hotel stay. So again, it bodes well that we have another potential operator who will have a facility that is going to be graded at the fivestar level. Two other comments . . . well, another comment I will make is that for the transport industry, I think it is another opportunity for them to start to prepare themselves for another level of improved service. I think I have said it here before (and I will say it again), something as basic as the vehicles have to possibly be looked at. They are labelling themselves as limousines, but what they present is not what is expected. So some-times there is a challenge in that, I ordered a limousine service, but the p hysical vehicle is actually not what I expected when it arrived. So, we have to look around that to make sure that presentation can actually match what is expected. And what made me smile with the Junior Minister’s announcement is that the hotel is proposed to have several pickleball courts as opposed to tennis courts. And in terms of an amenity, it is interesting to note that several of the Bermuda properties have actually transitioned their tennis courts to pickleball courts. And some of the commentary is that the pickleball game is a lot faster, and actually it does cater to (I want to say) a different clientele and sometimes an older clientele. Because the pickleb all game, while as rigorous and exciting, is actually a little bit less physically demanding than the extended tennis game. So, you are seeing that there are more and more courts being transitioned from traditional tennis courts to pickleball. The last comment I will make is to everyone who may be listening or who may be interested in the industry because we have the Fairmont Southampton coming on board and other hotels. And it means that we are going to need to have more people available to work in those establishments. And as the Opposition Deputy Leader alluded to, you commented on the fact that we are going to need —
[Inaudible interjection]
Mr. Anthony RichardsonThe Whip, sorry. —more and more Bermudians available. So, to the extent that there are persons who are either unem-ployed or underemployed, they need to start preparing themselves for what is going to be a significant opportunity in the next 12 to 24 months so they can actu ally be …
The Whip, sorry. —more and more Bermudians available. So, to the extent that there are persons who are either unem-ployed or underemployed, they need to start preparing themselves for what is going to be a significant opportunity in the next 12 to 24 months so they can actu ally be prepared. So, Mr. Speaker, with those comments I will just reiterate the fact that I am excited to know that we are at a stage now whereby we are considering the next phase of development of the Ariel Sands and certainly look forward to the stage whereby they get t o actually 248 15 December 2023 Official Hansard Report
Bermuda House of Assembly open up and we are able as a community to benefit more broadly from a new iconic hotel property. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, MP Richardson. No other Member? Minister Campbell. Hon. Vance Campbell: Thank you, Mr. Speaker. Mr. Speaker, Ariel Sands was built and established by the Dill family in the early 1950s, then oper-ated as a hotel until its closure in 2008. It was one of those, the first hotel, …
Thank you, MP Richardson. No other Member? Minister Campbell. Hon. Vance Campbell: Thank you, Mr. Speaker. Mr. Speaker, Ariel Sands was built and established by the Dill family in the early 1950s, then oper-ated as a hotel until its closure in 2008. It was one of those, the first hotel, the first tourist cottage colonies in Bermuda. Unfortunately, Mr. Speaker, the hotel was demolished in 2014. (I believe it was 2014.) And the 13.8 acres that it stood on has remained vacant since. This same 13.8 acres is located immediately above a picturesque beach and has unobstructed views of Bermuda’s famed South Shore waters. So it is in a prime location, Mr. Speaker. The developers, JTRE Holdings, after much due diligence which has taken, I believe, approximately over a year, the past year, they have decided to move forward. Also, during this process there has been some back -and-forth between the Ministry and the deve lopers, getting clarification, getting information. So that has somewhat delayed the process that we are now debating today. The developers, as I said, are JTRE Holdings, and they, as the Junior Minister mentioned earlier, are looking to develop a five- star product with 131 keys consisting of 21 private five- star villas, 33 hotel suites and 30 condos. I think it is very important to mention at this time, Mr. Speaker, that the condos and the villas, although privately owned, will form part (as is a requirement under the Tourism Investment Act) of the hotel inventory. Now again I am going to repeat what the Junior Minister said on this because it is important to repeat this, that this project will provide jobs for our Bermudians during the construction phase and for many years after during the operational phase. In add ition, Mr. Speaker, the operator, Kempinski Hotels group, their mandate is to provide top- notch training for its employees. So, what does that mean for our Bermudians who are looking to work in Ariel Sands once it is opened? That means they get top- notch t raining. They increase their skills. And in increasing their skills and experience, they become an employee of choice. And then they can pick their destination, their future. They are more marketable now, having had that top- notch training. So, it is important for Bermudians from that perspective that not only are they being trained, they are being trained in providing luxury service. And I think that is important for our Bermudians to keep in mind as it relates to their career prospects in t he hospitality industry. As was mentioned by the Junior Minister, again I will repeat it, these professions are consistent and in line with the Tourism Investment Act 2017 as amended earlier this year. Now, Mr. Speaker, when we made those amendments, this is the type of investment, this is the type of project that we had in mind when we brought those amendments to this House earlier this year. And it is good to see that it is bringing our conces-sions in line with what is being offered by our competition fur ther to the south, that it is bearing fruit. Now, Mr. Speaker, the predevelopment phase is ongoing now, I am told. And the plan is to go into phase 1 at the end of this year. The predevelopment phase will finish at the end of this year. Phase 1 will begin at the end of this year in which they will put this project out to tender. And that should conclude by mid2024. And at that time construction will begin, mid2024, and it is expected to finish the end of 2026. The Kempinski group will join the project and get on the ground in 2025 so that that trai ning project, very important, can be put in as early as possible, the training of the future employees. Finally, the plan is to open this hotel fully in early 2027. I am excited about this. I thank the Junior Minister and the Minister who sits in another place for bringing this Tourism Investment Order, and I support it fully. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, Minister Campbell. Does any other Member wish to make a contribution? Minister Hayward. Hon. Jason Hayward: Mr. Speaker, as stated by Honourable Member Caines, the revival of Bermuda’s tourism hinges upon strategic investment. And strategic investment is what this Government actually seeks. And that is facilitated by these …
Thank you, Minister Campbell. Does any other Member wish to make a contribution? Minister Hayward.
Hon. Jason Hayward: Mr. Speaker, as stated by Honourable Member Caines, the revival of Bermuda’s tourism hinges upon strategic investment. And strategic investment is what this Government actually seeks. And that is facilitated by these Investment Orders that we put in place. Mr. Speaker, the industry standard in terms of the number of Bermudians employed hinges around 70 per cent. There is a misconception that the majority of employees within our hospitality industry are non-Bermudian. But that is not the reality. The reality is that it is around that 70 per cent mark. So, the 70 per cent which is built within the [draft] Order is consistent with our current industry standards. You have some establishments that are higher than 70 per cent, and some are lower. Where we have occupational categories that are lower than 70 per cent, that is typically in management. And that is what we seek to ensure, that we have Bermudians taking advantage of greater op-portunities in those particular areas by putting the training and management development requirements in place. In the last meeting of the House, Mr. Speaker, we actually highlighted where the Department of Work-force Development had successfully worked with a number of hotels to vet their development plan. And those plans are actually bearing fruit. I did want to speak to a comment that Honourable Member Cannonier made in terms of Bermudians
Bermuda House of Assembly will be footing the bill for these concessions . We have reduced taxes for Bermudians. Bermudians are not paying increased taxes because we are having these concessions put in place. Additional to that, right now we are receiving absolutely no jobs, absolutely no in-creased bed capacity, and absolutely no additional tax [revenue] from having properties sit vacant and dormant. This certainly will increase the number of jobs, increasing the employee income within the industry. If we have limited bed capacity and bed inventory, that certainly is going to limit our ability to house tour-ists.
The SpeakerThe SpeakerMinister, do you mind if I interrupt you for a moment? Do you intend to speak much longer? Because we are at 12:30. You can break and come back at two, or you can close us and we can go to lunch at this point. Your . . . Hon. …
The SpeakerThe SpeakerNinety seconds? Okay. And then we will go to lunch. Hon. Jason Hayward: Yes.
The SpeakerThe SpeakerAll right. Hon. Jason Hayward: And so the establishments will also raise tax [revenue] in other areas. So instead of our saying that the residents of Bermuda will be footing the bill, I would say that investment and the development of the facility, the taxes generated and the income generated …
All right.
Hon. Jason Hayward: And so the establishments will also raise tax [revenue] in other areas. So instead of our saying that the residents of Bermuda will be footing the bill, I would say that investment and the development of the facility, the taxes generated and the income generated would actually offset the taxes that we are deferring to support the development of this site. But development is what we need, development is what we want and development is what we are getting. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you. Minister, before you sit, would you like to move us to lunch? Hon. Jason Hayward: Mr. Speaker, I move that the House adjourn to lunch.
The SpeakerThe SpeakerAre there any objections? There are no objections. The House now stands adjourned until 2:00 pm. [Gavel] Proceedings suspended at 12:3 2 pm Proceedings resumed at 2:03 pm [Hon. Dennis P. Lister, Jr., Speaker, in the Chair] The Speaker: Good afternoon, Members. The House is back in session. [Gavel]
The SpeakerThe SpeakerWe are in the process of the first Order of the Day, which is the consideration of the Tourism Investment (Ariel Sands) Order 2023. And I believe the Junior Minister was about to wrap up.
The SpeakerThe SpeakerYes. DRAFT ORDER TOURISM INVESTMENT (ARIEL SANDS) ORDER 2023 [Continuation thereof]
Mr. Hubert (Kim) E. SwanI just want to thank Members for their contributions. I want to give a special thanks to the Minister for the Cabinet Office, who prior had responsibility and did a great deal of the heavy lifting that was required to get these two draft Orders, but this p articular draft …
I just want to thank Members for their contributions. I want to give a special thanks to the Minister for the Cabinet Office, who prior had responsibility and did a great deal of the heavy lifting that was required to get these two draft Orders, but this p articular draft Order as we are speaking to today, over the wire. And definitely he addressed the questions that were posed from his substantive knowledge of certainly the pre- development stage, Mr. Speaker. That will be finalised by the end of this year, and construction will conclude by the end of 2025. I think it is important to note that the acquisition of land featured for $12 million, and the construction hard costs are projected to be some $108 million. And all costs are featured to be $155 million. Mr. Speaker, I would like to give special thanks to Permanent Secretary, Ms. Marva O’Brien, and espe-cially the Policy and Regulations team of Ms. Rhonda Woods; Senior Manager, Mr. Carlos Durham; and Mr. Aaron Swan, Compliance Officer; and Ms. Chanel Burchall, administrative assistant with the Policy and Regulations Unit of which at one time formed part of the original Bermuda Department of Tourism, but now do licensing and compliance work as it relates to tourism. As we conclude this draft Order, I would just like to say for me, Mr. Speaker, having been one who plied this trade, promoting the Ariel Sands property in the 1980s and the 1990s especially for golf visitors, this [draft] development Order is definitely a step in the right direction. I believe one of the Members who spoke (I believe it was Minister Campbell) put it best that at this particular time the property has not been realising its full potential. But with the development [draft] Order of today and t he opportunities that will come as a consequence of these concessions that are going to take place, many jobs will be put in place and much- needed foreign currency will be circulating throughout Ber-muda. 250 15 December 2023 Official Hansard Report
Bermuda House of Assembly So with that said, I move that said Order be approved and that a suitable message be sent to Her Excellency the Governor, Mr. Speaker. Thank you.
The SpeakerThe SpeakerThank you, Members, for your participation, and thank you, Junior Minister. The Order has been approved and the necessary documentation will be forthcoming. [Motion carried: The Tourism Investment (Ariel Sands) Order 2023 was approved.]
The SpeakerThe SpeakerWe now move on to the next item, which is item number 4 (but we are doing it as item number 2), which is consideration of the Tourism Investment (Bermudiana Beach Resort) Order 2023. And again, the Junior Minister will present this. Junior Minister.
Mr. Hubert (Kim) E. SwanMr. Speaker, I move that consideration be given to the draft Order entitled the Tourism Investment (Bermudiana Beach Resort) Order 2023 proposed to be made by the Minister responsible for Tourism under section 3 of the Tourism Investment Act 2017, as applied by section 13B of the Bermuda Housing Act …
Mr. Speaker, I move that consideration be given to the draft Order entitled the Tourism Investment (Bermudiana Beach Resort) Order 2023 proposed to be made by the Minister responsible for Tourism under section 3 of the Tourism Investment Act 2017, as applied by section 13B of the Bermuda Housing Act 1980, with written agreement of the Minis-ter of Finance in exercise of the power conferred by section 5 of the Tourism Investment Act.
The SpeakerThe SpeakerAre there any objections? There are none. Continue, Junior Minister. DRAFT ORDER TOURISM INVESTMENT (BERMUDIANA BEACH RESORT) ORDER 2023
Mr. Hubert (Kim) E. SwanThank you, Mr. Speaker. Mr. Speaker, the purpose in bringing this Tourism Investment (Bermudiana Beach Resort) Order 2023 be fore this Honourable House is to enable the grant of tax relief to developers investing in the tourism product, Bermudiana Beach Resort, which is in the na-tional economic interest of Bermuda. …
Thank you, Mr. Speaker. Mr. Speaker, the purpose in bringing this Tourism Investment (Bermudiana Beach Resort) Order 2023 be fore this Honourable House is to enable the grant of tax relief to developers investing in the tourism product, Bermudiana Beach Resort, which is in the na-tional economic interest of Bermuda. Mr. Speaker, Honourable Members will recall the Tourism Investment Act became operative in 2017 during the month of November. The primary objective of the Act is to make Bermuda more attractive to foreign investment and to incentivise and assist local tourism - related business owners to re- invest in their product. Mr. Speaker, this Act was amended in June of 2023 to provide the Minister of Tourism more discretion in the grant of relief to hotel developers, as well as persons interested in investing in the restaurants and attrac-tions. Mr. Speaker, with respect to hotels new and redeveloped, the amended Act extends the period of re-lief from a period not exceeding 10 years to a period not exceeding 15 years. Mr. Speaker, the [draft] Order before the Honourable Members is the culmination of an application for a tourism investment Order for a new hotel for the Bermudiana Beach Resort. This applica-tion was made by the Bermuda Housing Corporation on behalf of its wholly owned subsidiary, the Bermudiana Development Company, Ltd. Mr. Speaker, this Honourable House will recall that in February 2019 the Tourism Investment (Bermudiana Beach Resort) Order 2019 was issued. Mr. Speaker, this Honourable House will be advised that this Order expired on February 21, 2022. As the requiremen t to complete construction of the project within three years of the operative date of the Order was not met, the project lost two years of construction due to the COVID -19 pandemic. Mr. Speaker, now the Bermudiana Beach Resort is being developed in one phase, which includes 94 condos for sale, providing 110 hotel keys for rental. The redevelopment of the property in-cludes work on interiors; kitchen and bathroom up-grades; construction of eight elevator towers; and amenities including a pool, pool deck and a pool bar. In addition, a new building has been added to the project for the reception area, hotel offices and storage. Mr. Speaker, Honourable Members will note that the terms of the [draft] Order are consistent with the Tourism Investment Act 2017 and provide the relief sought for a period of 15 years. That relief is set out in clause 3 of the draft Order and provides for the following: 1. full relief from customs duty for a period not ex-ceeding 15 years of relief in respect of the building, furnishings and equipping of the hotel from the operative date of this draft Order; 2. full exemption from hotel occupancy for a pe-riod not exceeding 15 years from the hotel’s opening date; 3. full exemptions from employer’s share of the payroll tax for a period not exceeding 15 years from the hotel’s opening date; 4. full exemption from land tax for 10 years for a period commencing in year six and ending in year fifteen of the hotel’s opening date; and 5. deferral of landholding charges in respect of a hotel that is placed in the hotel inventory. Mr. Speaker, clause 4 of the [draft] Order sets out the critical means by which the hotel qualifies for the exemption from the employer’s share of payroll tax, which is that a management training programme is in operation for Bermudians employed at the hotel. Mr. Speaker, in 2019 the Bermudiana Beach Resort be-came a Tapestry Collection by Hilton, which was the first global hotel company. Hilton University provides
Bermuda House of Assembly property -specific training information together with a variety of learning tools and resources for employees of the aforementioned Tapestry Collection. Mr. Speaker, clause 4 sets out the critical means by which the Bermudiana Beach Resort quali-fies for the exemption from land tax. Mr. Speaker, this means that 70 per cent of the hotel staff must be Bermudian in years six through fifteen after the hotel’s opening date. Mr. Speaker, as with previously awarded tourism investment orders, the benefits to the economy include an increase in hotel beds and an increase in employment in tourism and tourism- related sectors. Mr. Speaker, I am pleased to commend this Order for the support of this Honourable House. Thank you.
The SpeakerThe SpeakerThank you, Junior Minister. Does any other Member wish to make a contribution at this time? MP Cannonier.
Mr. L. Craig CannonierThank you, Mr. Speaker, and good afternoon to yourself, colleagues and the public. Once again, I am glad to see that something is going to happen here of consequence. I must say that another Minister in a different capacity has talked quite a bit about some of the work that …
Thank you, Mr. Speaker, and good afternoon to yourself, colleagues and the public. Once again, I am glad to see that something is going to happen here of consequence. I must say that another Minister in a different capacity has talked quite a bit about some of the work that is being done and what to expect in the future. But it is good t o see that this has come to the House. I will repeat the question that I had before, and that was, it has taken six months. Considering the fact that this is a priority, I am not sure if the process typically takes that long. I am just trying to understand how come we are just now at the end of the year getting to this when it was made in June of this year? Not a big thing, but it would be interesting to understand why we could not have gotten it maybe done sooner, as we know that it is a priority of this G overnment to get hotels up and running. Bermudiana Beach Resort has had a troubled past. There have been many highlights that hopefully it would get open, something would happen to it, it did not pan out. It started as low -cost housing. It did not pan out for potentially a number of reasons. I do not believe that there was ever . . . maybe one, maybe two tenants at the time. I do not recall the exact number, but no more than that, I believe. And the only time that it actu-ally really had any real revenue coming in was during the infamous America’ s Cup period of time where it was being rented out, which was good. It was revenue coming back into the government coffers. So now to see that this is going to take place, it is good. I mean, initially it did cost the people of Ber-muda about $42 million to build initially as a low -cost housing project. And now I believe we are putting in about $90 million, somewhere thereabout s, to get this hotel up and going. So, it is a good thing that we have this opportunity. As has already been spoken, we might have been able to do both [draft] Orders at the same time actually. But I do not want to repeat myself. So there are good opportun ities, as we all know in this House, that can come of this. The challenge we have is making sure that the project gets up and going because it has had these challenges in the past. So, I am hoping that with the timeframes . . . and I think there were some timeframes given before by a different Minister. But I am not sure if we are still on schedule with what is going on, has been going on, the work up there and whether or not and when we anticipate opening the doors there. So, it would be good to hear that from the Junior Minister where we stand there. I was going to give a bit of a chuckle to the Honourable Member Caines and say that I hope that with all of these projects that we understand are coming on, that BELCO is going to be able to provide enough current, power, electricity to all of these here because it is going to require quite a bit of it. Now, I do not know whether or not this particular project is going to have some renewable energy built within it. I understand that Southampton Princess at the time when they were looking at it, the remake was not involving any renewable energy. So it would be good to hear that some of these folks are looking at renewable energy to ease the pain of BELCO —not to give BELCO any accolades in any kind of way, but that we are looking down the future and that thes e projects have some sort of renewable energy that will assist as we move forward with other projects on the Island like automobiles and the likes. So, I have mentioned it already. The challenge I see coming, if these projects all do get online close to the same time, is that the existing hotels with training the people that they have is going to be under stress because I believe that these other new projects like the Bermudiana Beach Resort will be looking to fill its man-power. And some of that manpower is going to come from some of these other hotels, for sure. So, we do have, and I am identifying, a challenge that could be coming up in the future i n the next couple of years. So, we need to work toward ensuring that we have the ca-pacity to be able to man these hotels with as many Ber-mudians as possible. I took word from another Minister who mentioned about the hotels and Bermudian manpower. But I believe that this is going to be under stress big time when some of these newer projects come on. And so we have got a lot of work to do in order to get Bermudians back involved and back interested in the hotel industry. Many of those who have left other projects have retired out. So now in another two or three years, three or four years, we are going to have a whole new crop of folks who never were involved in the industry who hopefully we can find a way to interest them in the hotel industry. So, by all means this is a good project. I am looking forward to seeing that it gets up and going. 252 15 December 2023 Official Hansard Report
Bermuda House of Assembly One of the other questions that I have is, Is this hotel going to be fully funded by the people of Bermuda? Or is there any investment, or looking for any investment into the project outside of Bermuda, international investment into this particular project ? It would be interesting to see whether or not that is going on. And with it being subsidised heavily by the people of Bermuda, what can the people of Bermuda expect then as far as return is concerned as well and putting this hotel up and going? So with that in mind I would appreciate the Junior Minister’s comments. I look forward to hearing from [the Junior Minister on] the two major questions that I asked, if he can respond to those. Thank you.
Mr. Wayne CainesMr. Speaker, the Tourism Investment (Bermudiana Beach Resort) Order 2023. I have had the opportunity to consider all of the facts and the circumstances, how the project started origi nally, what it has morphed to be and the benefit that it can bring to Bermuda in its current iteration. And …
Mr. Speaker, the Tourism Investment (Bermudiana Beach Resort) Order 2023. I have had the opportunity to consider all of the facts and the circumstances, how the project started origi nally, what it has morphed to be and the benefit that it can bring to Bermuda in its current iteration. And I will go in to why we need tourism development, where we stand. Again , the names of a lot of hotels. I think it might be important for me to repeat those, those names again because we need to understand w here we are and what this type of investment does, why we should continue in this vein and why we are on a good wicket. And why this specific development is important and why it is important to Ber-muda. In February 2019, the Tourism Investment (Bermudiana Beach Resort) Order 2019 was issued. It expired on February 21, 2022. As a requirement for the completion of the construction of the project within three years was not met. The reason why it was not met was not because of anyone doing anything wrong. It was not completed because of any malfeasance. It was not completed because the country was dealing with a once- in-a-lifetime pandemic. And that, limitations based on the pandemic, caused the project not t o get finished as planned. It is important for us to understand that, because when we understand what they were trying to do, how the limitations on our entire country had been, we will see why they are now back in the room. But before we go there, it is important for us to underst and where Bermuda is with reference to tourism. Because ultimately, the matter of where we go with the need to make sure this thing is financially prudent —and it must be, the fact that we must make sure that it is on time and it is on budget —and it should be, and it will be. The most important thing that we have to show is the Government’s plan and its will and its endeavours to make sure that we increase our tourism numbers. If we go back to the 1990s, there were approximately 4,200 hotel rooms in Bermuda. Today there are just over 1,800 rooms. To keep it in context, Jamaica has 21,000 beds, or 21,000 rooms. In Cayman, which is a comparable jurisdiction, they have 7,000 rooms. Now, there are cyclical facts on the lack of beds. Some the things happened as a result of not having enough beds. We are not able to negotiate the types, the routes and the number of days with the airlines. And so this is cyclical because if we do not have the beds, the airlines do not see us as a premiere destination of choice and we start losing the days of the flights coming to Bermuda. And then people find it more difficult to come to Bermuda. And when they do find an opportunity to come to Bermuda, t heir flights are too expensive. So what we are doing right now with the advent of (as we saw) the legislation today for the Ariel Sands and what is happening at Cambridge Beaches and Azura and the Southampton Princess coming online, we see the opportunity for us not just to say and use words like a heyday or renaissance in tourism. It shows a complete footprint of where we can go and how we can do things. So, if you are an investor in Bermuda and you can look at the legislation to see that there is a clear pathway, there are opportunities in Bermuda. Then you would say, This is a place that I want to invest in. If people see Bermuda as a legitimate place . . . our Companies Act is clear. We have some of the best financial regulation in the world. If people look at this tourism legislation and they can see effigies, blueprints of where they can come to Bermuda, ge t the necessary subsidies and they can start building . . . and [see that] it is supported, and how it is supported. And we can look at effigies of success like we are now seeing today with Arial Sands and now with the Bermudiana Beach Resort. This hotel plans to have 94 condos and 110 rooms. We went through the Ariel Sands today. We see where our numbers are getting stronger. But we must always keep in mind and always keep in the forefront of our mind what we are trying to achieve in this room. What we are trying to achieve in this room is to make sure that we continue to grow our tourism numbers. But when the BTA goes globally, they have a product that they are selling in that we have enough beds. Whilst cruise ship visitation has recovered to levels far higher . . . far similar to 2019, the economic surveys show that a visitor who stays on land spends on average six times what a cruise ship visitor spends. And it is imperative that we attract more air visitors to increase the economic impact of tourism. Tourism for a very long time was the bailiwick of our economy. We had moved to international finance, and now as the second pillar of our economy, we see the signs and the green shoots of a tourism industry that is ploughing and fighting its way back. This legislation is a part of the economic recovery for this country. It is part of an
Bermuda House of Assembly economic plan. It is a strong pillar in our tourism plan. And it is something that should be supported. This legislation allows full release from customs duty for a period not exceeding 15 years of relief in respect of the building, the furnishings and equip-ment of the hotel from the operative date from this [draft] Order. A full exemption from hotel occupancy tax for the period not exceeding 15 years from the hotel’s opening date. Full exemption from the employer’s share of payroll tax for a period not exceeding 15 years of the hotel’s opening date. A full exemption from land tax for 10 years for a period c ommencing in the sixth year and ending in the fifteenth year of the hotel’s opening date. And the deferral of landholding charges in respect of the hotel that is placed on hotel inventory. Now, when you look at that, those are considerable offerings by the Government. When you look at what is in return, how that benefits, how that adds to our going to our date and to our numbers, that is a significant arrow in our quiver with reference to w hat we look like. If all of the hotel projects in the pipeline come to fruition, Bermuda could have 2,500 rooms by 2026.
[Pause]
Mr. Wayne CainesNo, that would be the total number of rooms here, 180. [Inaudible interjections ]
Mr. Wayne CainesThat would be an increase of 108 per cent of the 2019 inventory. The projects that we have on tap include Bermudiana Beach Resort, the Fairmont Southampton, the Grotto Bay, the Azura. We have seen projects that have been completed like Cambridge Beaches. We hope that such projects that we …
That would be an increase of 108 per cent of the 2019 inventory. The projects that we have on tap include Bermudiana Beach Resort, the Fairmont Southampton, the Grotto Bay, the Azura. We have seen projects that have been completed like Cambridge Beaches. We hope that such projects that we see will inspire another major property that we have on Island like Elbow Beach. And we know what having that hotel up and running would mean to our economy. The BTA looks forward to and is excited about these two [draft] Orders that will be passed in the House today because it means a step in the right direction for tourism. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, MP Caines. Does any other Member wish to make a contribution at this time? Minister of Works.
Lt. Col. Hon. David A. BurchI could not let this opportunity pass without having a few comments on the Bermudiana Beach Resort. I am going to first touch briefly on its chequered history —and ever so briefly,
Mr. Speaker.
The SpeakerMm-hmm.
Lt. Col. Hon. David A. BurchClearly, we started this as a Government prior to 2012. And it has been a long and painful journey. When we returned to Government in 2017, this option was already on the table. And whilst there has been . . . I think it is a fascinating thing that you …
Clearly, we started this as a Government prior to 2012. And it has been a long and painful journey. When we returned to Government in 2017, this option was already on the table. And whilst there has been . . . I think it is a fascinating thing that you try to build housing and people criticise it. So, you come up with another solution and they criticise that and say, Why didn’t you do housing? Be all of that as it may, Mr. Speaker, the fact of the matter is that there are currently 94 persons working at Bermudiana Beach, 66 of whom are Bermudian, 5 are spouses of Bermudians and 23 are non- Bermudians. And they have been working there for more than a year and go-ing like gangbusters. So, the process of Bermudiana Beach really has been fascinating to see. Over the last year I have visited the site about half -a-dozen times. And to see the progress each time and the handiwork of Bermudians is very encouraging. The fact that we were able to secure Hilton Hotels as the partner to run the hotel gives us tremendous advantages in terms of advertising and tourism standards. But what has also been fascinating and interesting and challenging too is that you took a residential property and are tur ning it into a hotel property. So what that means, Mr. Speaker, is that unlike in your house where you blow a fuse and you know where to go and fix it, in a hotel all of those rooms have to operate at a high standard and consistently. So, it has meant replacing a lot of the electrical and plumbing infrastructure and having all sorts of contingencies in place. I am not sure if the Junior Minister mentioned the date of opening. But it is a fairly interesting process from a Hilton point of view. So, we expect to finish all of the construction by July 1 of next year and have the hotel ready to be opened. Hilton, as a matter of their own internal protocols, require two months to run that hotel before they will agree to opening it. So, that means that every toilet has to be flushed at the same time. All of the lights have to be turned on at the same time. You get vol unteers to stay in the hotel so that it can function as a hotel, and they can confirm that all of the facilities that are being offered to tourists obviously meet the Hilton standard, but also meet any sort of tourism standard in the world. So, the relationship between the [Bermuda] Housing Corporation and Hilton has been a very cordial one and direct one, where Hilton were here in August as part of their due diligence prior to opening to inspect the works and estimate when the hotel will be concluded. And we are on track to meet those deadlines. The other aspect I would like to touch on, Mr. Speaker, is that Hilton have what is called Hilton University.
The SpeakerThe SpeakerMm-hmm. 254 15 December 2023 Official Hansard Report Bermuda House of Assembly Lt. Col. Hon. David A. Burch: And you do not need to be a rocket scientist to figure out what that is. It teaches their staff that Hilton way. So, the employees at Bermudiana Beach, before it opens, …
Mm-hmm. 254 15 December 2023 Official Hansard Report
Bermuda House of Assembly Lt. Col. Hon. David A. Burch: And you do not need to be a rocket scientist to figure out what that is. It teaches their staff that Hilton way. So, the employees at Bermudiana Beach, before it opens, will be hired and sent to that place to be able to learn the Hilton standards so that w hen the hotel opens it can flourish as a new entity to the Bermuda tourism market. The final thing I would like to say, Mr. Speaker, is that I would really like to publicly commend the Board of the [Bermuda] Housing Corporation who . . . in reality nobody has any hotel experience, but [they] have enthusiastically monitored and visited and approved the payments for this exercise. And I can also confirm that the project is fully funded. That was one of the issues we had and still have with people purchasing. The stopand-go nature of the exercise gives people doubt. But we have no doubt that once the hard landscape is started to be put into place and major construction starts to wind down and there are tours of the facility, that it will be acknowledged for the world standard that we know that it is going to be. So, I want to publicly thank the Board of the [Bermuda] Housing Corporation who also serve as the Board of the Bermudiana Beach Development Company, Ltd., ably led by MP Chris Famous, for their ef-forts in this regard and the stewardship over the taxpayers ’ purse in seeing this development through to its conclusion. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, Minister. Does any other Member wish to make a contribution? Minister Campbell. Hon. Vance Campbell: Thank you, Mr. Speaker, I will be a lot briefer with this one here. Mr. Speaker, when we hear or when we look at and analyse the results of tourism in these days, …
Thank you, Minister. Does any other Member wish to make a contribution? Minister Campbell.
Hon. Vance Campbell: Thank you, Mr. Speaker, I will be a lot briefer with this one here. Mr. Speaker, when we hear or when we look at and analyse the results of tourism in these days, one of the criticisms levied against the results that we are seeing in Bermuda is that our neighbours to the south have exceeded the 2019 tourism numbers and Bermuda still lags behind. Well, you know, how many of those neighbours to the south have lost 30 [per cent] to 35 per cent of their rooms just prior to COVID -19 like we have here? So, this [draft] Order here, as well as the one we discussed previously, will help bridge that gap from the rooms that we lost with the closure of the Fairmont Southampton and the Elbow Beach. We now know that the Fairmont Southampton . . . we have some good news on that. And we are hopeful construction will be beginning soon up there. So, this here adds to filling the gap, bringing these online fills that gap. When Bermuda gets back to the numbers that we had, the number of rooms, the number of keys, whichever way you want to look at it, that we had in 2019, then we can truly compare the numbers that we achieve here as far as tourism arrivals, et cetera, with our neighbours to the south. And I think the public will see that we will begin to exceed what we were doing in 2019. The obvious points on this here are that there will be employment, more employment opportunities for our people both in the construction and the operational phases of this here. And again, just like Kempinski group, the Hilton are very big on training. So, our people will be able to upgrade their skill set and then increase their capability of having a successful career in the hospitality industry. And the last thing, Mr. Speaker, that I wish to highlight with this particular project is that it adds to the variety and price options that we will be able to offer to visitors to the Island. So, I want to thank the Minister and the Junior Minister and t he [Bermuda] Housing Corporation for their efforts to continue to push this to the finish line. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, Minister. Does any other Member wish to make a contribution at this time? There are none other. Junior Minister.
Mr. Hubert (Kim) E. SwanThank you, Mr. Speaker. Mr. Speaker, I would like to wholeheartedly thank the contributions of Members, especially two substantive Ministers who are intimately knowledgeable and involved in the progression of this Tourism Investment (Bermudiana Beach Resort) Order 2023, especially the Minister responsible fo r Public Works, whose Ministry, through the …
Thank you, Mr. Speaker. Mr. Speaker, I would like to wholeheartedly thank the contributions of Members, especially two substantive Ministers who are intimately knowledgeable and involved in the progression of this Tourism Investment (Bermudiana Beach Resort) Order 2023, especially the Minister responsible fo r Public Works, whose Ministry, through the Bermuda Housing Corporation and its connection with the Minister of Public Works, has navigated us to the point where our hotel beds can be increased in the shorter order for Bermuda. And we are very thankful for that. The Minister for Public Works did address the issues that were raised, the redevelopment stage from May 2022 through to March of 2024. And I believe the Minister even elaborated on the due diligence of Hilton, who take pride in their training mechanism bei ng Hilton - specific. And certainly, through my connections with the Ministry of Public Works, through the chairmanship of a quango on behalf of the Ministry of Public Works — that is, golf courses —I have had some indirect connection with Hilton through one of our properties where we got to meet one or two of those persons who spent time in Bermuda. [They] made sure that all of the concerns that were raised with regard to the property on the cliff . . .which is not so dissimilar to many properties in Bermuda, quite frankly. But they made sure that they did all of that due diligence as well. And so they will provide the Hilton level of standards for the training. And that bodes well for anyone entering into the hospitality industry. You know, it was mentioned that the number of properties that are starting to come online may come with problems. But those will be nice problems to have
Bermuda House of Assembly to tackle, Mr. Speaker. And I believe the Minister responsible for Labour has already been well onto that subject as well. So, we look forward to these problems, which are success -driven problems, as we are starting to replenish our hotel stock going forward. And success breeds more success, and we are looking for other properties to do likewise —Lantana, maybe Sonesta, certainly Elbow Beach and other properties that are throughout the country. All that remains for me to do is to thank the Permanent Secretary, Ms. Marva O’Brien, and her team and especially the policy regulation arm of the Bermuda Department of Tourism that once was, Ms. Rhonda Woods -Smith, Mr. Carlos Durham, Mr. Aaron Swan, the C ompliance Officers who assist, Ms. Smith, the Senior Manager and Ms . Chanel Burchall, the Administrative Assistant. And also thank Mr. Paul Martin and the team at the Bermuda Housing Corporation and the Ministry of Public Works for helping to make this Tourism Investment (Bermudiana Beach Resort) Order 2023 a reality. And I move that said [draft] Order be approved and that a suitable message be sent to Her Excellency the Governor.
The SpeakerThe SpeakerThank you, Junior Minister. The matter is approved. And the appropriate documentation will be forwarded. [Motion carried: The Tourism Investment (Bermudiana Beach Resort) Order 2023 was approved.]
The SpeakerThe SpeakerMembers, that brings us to a conclusion of that item. The next item is item number 2 on the Order Paper, but it is number 3 on business to be done. And that is the second reading of the Bermuda Mone-tary Authority Amendment Act 2023 in the name of the …
Members, that brings us to a conclusion of that item. The next item is item number 2 on the Order Paper, but it is number 3 on business to be done. And that is the second reading of the Bermuda Mone-tary Authority Amendment Act 2023 in the name of the Prem ier/Minister of Finance. But I believe the Minister of . . . Minister Furbert, are you going to lead this one for him? Hon. Wayne L. Furbert: Yes, Mr. Speaker.
The SpeakerThe SpeakerOkay. All right. Thank you. You can proceed. [Pause] Hon. Wayne L. Furbert: Thank you, Mr. Speaker. Mr. Speaker, I move that the Bill entitled the Bermuda Monetary Authority Amendment Act 2023 be now read a second time.
The SpeakerThe SpeakerAre there any objections? There are none. Continue, Minister. BILL SECOND READING BERMUDA MONETARY AUTHORITY AMENDMENT ACT 2023 Hon. Wayne L. Furbert: Mr. Speaker, I am pleased to present to this Honourable House the Bill entitled the Bermuda Monetary Authority Amendment Act 2023. This Bill amends the Bermuda Monetary Authority …
Are there any objections? There are none. Continue, Minister.
BILL SECOND READING
BERMUDA MONETARY AUTHORITY AMENDMENT ACT 2023
Hon. Wayne L. Furbert: Mr. Speaker, I am pleased to present to this Honourable House the Bill entitled the Bermuda Monetary Authority Amendment Act 2023. This Bill amends the Bermuda Monetary Authority Act 1969 [the principal Act or the Act] to revise fees payable by long- term i nsurers to the Bermuda Monetary Authority [the BMA or the Authority], to amend the Fourth Schedule of the Act to move fees payable by persons registered and designated under the Insurance Act 1978 to a new Fifth Schedule to make prov isions for other fee- related changes. Mr. Speaker, Bermuda’s financial services sector is subject to the regulations and supervision of this great Authority. The Authority was established under the Act. The Authority operates pursuant to the Act, which provides it with a number of principal [ objectives] including supervision, regulation and inspection of fi-nancial institutions operating in or from within Bermuda. Mr. Speaker, the Authority is mandated to act as advisor to the Minister of Finance on policy matters related to any financial institution. Accordingly, the Authority proposes laws where it can do so appropriately and consistently with its function under the Act. The Insurance Act 1978 provides the Authority with substantive licensing, supervision and intervention powers to regulate the insurance industry in Bermuda. Mr. Speaker, the Authority monitors the insurance industry to ensure that the regulatory framework is robust and it continues to reflect the nature and complexity of the market under its purview. This includes ensuring that the level of risk in the market is adequately managed and ensuring that the fees charged by the Authority are reflective of and align with the cost of appropriately overseeing regulated institutions. Key highlights of the fee- related amendments are as follows: • Align registration and annual fees for long- term insurers, Class C, Class D and Class E insurers with the current level of risk and maturity of the market and the level of supervisory activi-ties required to oversee such insurers. • Registration and annual business fees for these insurers are proposed to be increased. • Increase fees for adjustments to certain capital factors used in the valuation of technical provisions for what are Bermuda’s solvency capital requirement [to] a lign with the level of complexity of the adjustment requested. For context, the BSCR (Bermuda Solvency Capital Requirement) represents the minimum amount of capital commercial insurers should hold to cover an adverse development and liabilities and assets arising from unexpected events. For most insurers, the BSCR is calculated 256 15 December 2023 Official Hansard Report
Bermuda House of Assembly [using] a standard model prescribed by the Authority. However, the Authority in limited cases allows insurers to apply for adjustments to some factors in the standard BSCR model to better reflect the risk profile of the entity. Such adjustment can vary in complex ity, and the Bill seeks to align the fees with the level of complexity of these adjustments and the level of review required. • Introduce fees related to the use of an internal scenario- based approach model for valuation of best estimates of technical provisions to align with the complex computational nature of these models and [the requisite] to technical expertise required to review and approve the same. Applications will be subject to a sliding scale fee based on the structural complexity of the model. • Apply a supplementary fee to long- term insurers who write retail business to reflect the operational risks inherent in writing direct insurance including increased money laundering and market conduct risks and to cover the additional costs associated with appropriately su-pervising such business. • Introduce an annual fee payable by the head of the Internationally Active Insurance Group [IAIG] to support the effective supervision of internationally active insurance groups. Mr. Speaker, by way of background, the Authority undertook an extensive consultation process this year through the publication of two consultation papers published on the Authority’s website on the 24 th of February and the 28th of July 2023, respectively. As per the Authority’s normal customs and practice, the Au-thority has engaged with the insurance industry including Bermuda International Long Term Insurers and Re-insurers (BILTIR), the Association of Bermuda [Insurers] and [Reinsurers ] (ABIR) and the wider public on proposed changes to enhance the regulatory framework for commercial insurers and insurance groups.
[Crosstalk ]
Hon. Wayne L. Furbert: Mr. Speaker, the proposed changes include targeted enhancements to the framework of long- term insurers which covered updates to the methodology to be used in the valuation of technical provisions requirements, the valuation of adjustments to elements of the previously referenced BSCR and other prudential standards. The consultation paper dated the 24 th of February 2023 also proposed revised fees to ensure that resources for the supervision of the enhanced regime are in place. Mr. Speaker, annual business fees and registration fees for long- term insurers have historically been significantly lower than those of insurers who carry on general business. This was reflective of the size and maturity of the long- term insurance industr y in Bermuda. However, the long- term insurance industry has matured, grown significantly and increased in sophistication. As such, fees revisions are being proposed to bring the annual business fees and registration fees charged to long- term insurers in li ne with fees charged to property and casualty insur ers and to meet the necessary costs related to the supervision of these insurers. This includes costs associated with ensuring that the level of resources and tools required for supervision are appropriate and well aligned with increased levels of technical reviews brought by the enhance-ments to prudential requirements set out in the consultation papers. Fees related to use offers scenario- based approach model. Mr. Speaker, consistent with the Authority’s continued efforts to protect policyholders and the industry at large by ensuring that risks in the insurance industry are properly managed, fees related to the use of certain factors and models use d in the evaluation of technical provisions that have been introduced in this Bill. Mr. Speaker, the Bill introduces fees related to the use of internal scenario- based approach (SBA) model for the valuation of technical provisions. For context, “technical provisions” refers to the funds that an insurance company set aside to cover their future expected liabilities arising from insurance policies they have issued. These provisions are essential for ensuring that insurers can meet their obligations to policyholders when they arise. Under the Authority’s regulatory framework, commercial insurers can use a prescribed standard model or their own internal model, provided they follow principles outlined by the Authority. Such an internal model is called an SBA [Scenario- Based Approach] model. The use of an SBA model can be very technical in nature, given the need to tailor this to the specific context of an insurer. As a result, it requires the Author-ity’s approval and ongoing review to ensure the model aligns with the prescribed principles. The fees intro-duced in this Bill are designed to support supervisory activities related to the review of these models. Mr. Speaker, the House is reminded that the Insurance Amendment Act 2023 passed by the House on the 19 th of May 2023 made provisions for the designation of an entity as the head of an IAIG (IAIG means Internationally Active Insurance Group) to support the effective supervision of IAIGs. This Bill introduces an annual fee to be charged to the entity designated as head of the IAIG. Mr. Speaker, the Bill also incorporates consequential amendments to the Insurance Act 1978 (the IA), a consequential amendment to remove the definition of “retail business” from section 30JA(2) of the IA as it [is] limited [to] the application of the definition of this section. A consequential amendment is made to section 1 of the IA to cause the definition of “retail busi-ness” to apply to the entire Insurance Act 1978. Additionally, a consequential amendment is made to insert provisions into [a new] section 27H of the IA to provide
Bermuda House of Assembly for circumstances in which the Authority may charge annual fees to the head of the IAIG and to make provisions for IAIGs to pay a fee upon designation [as] an IAIG and thereafter to pay fees annually. Finally, section 27F of the IA is amended to confirm the Authority’s rule- making powers for group supervision extended to IAIGs. Mr. Speaker, as part of the process of developing the proposed enhanced fee structure for long- term insurers, the Authority analysed the fees levied on long-term insurance by its regulatory counterparts in a num-ber of other jurisdictions. (I am sure most p eople are paying for that.)
[Inaudible interjection] Hon. Wayne L. Furbert: Mr. Speaker, as a part of the process of developing the proposed enhanced fee structure for the long- term insurers, the Authority analysed (which is appropriate) the fees levied on long - term insurers by its regulatory counterpart in a number of other juris dictions. The results of this analysis indicated that Bermuda’s new fee structure for the sector will remain attractive and aligns with the Island’s competitive position as a leading jurisdiction in the insur-ance industry. Further, B ermuda’s [value] proposition, which includes the maintenance of a Solvency II equivalency as it relates to the insurance regulatory regime, continues to set the Island apart from its peers. (We all know that.) The enhanced fees will allow the Authority to continue to meet the national and international regulatory and supervisory standards. Mr. Speaker, the Authority notes that stakeholders acknowledge the need for the Authority to re-vise fees to meet the necessary costs of effective supervision given the increasing complexity and diversity of Bermuda’s insurers’ long -term business model. The industry did, however, request a transitional period for implementation of the proposed annual business fees. In alignment with the feedback received, the Authority published the stakeholders’ letter on the 2 8 th of July 2023, noting that the increase in annual business fees for long- term insur ers will be phased in over three years, 2024 through 2026. The Fifth Schedule to the Bill reflects this proposed phased in fee structure. Mr. Speaker, it is worth remembering that the fee schedules applicable to regulated financial institutions are necessarily detailed and inherently complex. In this instance it must be noted that the fee schedule changes proposed within this Bill relate only to the insurance sector, and within that sector are focused on fees payable by long- term insurers. Accor dingly, from a Schedule comprising over 300 insurance- related fees, there are only approximately 70 revisions or additions proposed. Mr. Speaker, in closing I would like to thank all of those persons within the Authority, the Attorney General’s Chambers, the Ministry of Finance and the private sector, particularly members of BILTIR and [ABIR] who have all assisted with the developing of this Bill. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, Minister. ANNOUNCEMENT BY THE SPEAKER HOUSE VISITOR
The SpeakerThe SpeakerBefore I recognise anyone else, I would just like to recognise that in our Gallery today we have another former Member who is visiting us, this time it is a former Member from this Chamber, Maxwell Burgess. It is nice to have you in the Chamber. I see you have …
Before I recognise anyone else, I would just like to recognise that in our Gallery today we have another former Member who is visiting us, this time it is a former Member from this Chamber, Maxwell Burgess. It is nice to have you in the Chamber. I see you have got your daughter and grandson with you, if I am correct from here.
[Desk thumping]
The SpeakerThe SpeakerNice to have you here. Good. [Bermuda Monetary Authority Amendment Act 2023, second reading debate, continuing]
The SpeakerThe SpeakerNow, would you like to make a contribution? MP Pearman, you have the floor.
Mr. Scott PearmanThank you, Mr. Speaker. Mr. Speaker, I rise today to speak on the Bermuda Monetary Authority Amendment Act 2023. Mr. Speaker, for the benefit of the listening public this Bill runs some 74 pages, and it was introduced to us on Monday. And we, the Opposition, were invited to allow …
Thank you, Mr. Speaker. Mr. Speaker, I rise today to speak on the Bermuda Monetary Authority Amendment Act 2023. Mr. Speaker, for the benefit of the listening public this Bill runs some 74 pages, and it was introduced to us on Monday. And we, the Opposition, were invited to allow it to be tabled, debated and no doubt passed in one day. I point that out because someti mes people outside of this Chamber feel that all we do is throw bricks back and forward against each other, and it is not the case. I would hope that this would be seen by the Government and its Members as a demonstra-tion of bipartisanship on the part of t he Opposition. [Inaudible interjections]
Mr. Scott PearmanLet me start by — Hon. E. David Burt: Point of order, Mr. Speaker. Point of order, Mr. Speaker.
The SpeakerThe SpeakerPoint of order. POINT OF ORDER [Misleading] Hon. E. David Burt: Thank you, Mr. Speaker. The Honourable Member is misleading the House. He just told persons that we asked him to table 258 15 December 2023 Official Hansard Report B ermuda House of Assembly and debate a Bill in one …
Point of order.
POINT OF ORDER [Misleading]
Hon. E. David Burt: Thank you, Mr. Speaker. The Honourable Member is misleading the House. He just told persons that we asked him to table 258 15 December 2023 Official Hansard Report B ermuda House of Assembly and debate a Bill in one day. Standing Orders state that first and second readings can be between seven days. This was tabled seven days ago. We arranged a brief-ing for them. And so it is enabled. So, I think the Hon-ourable Member must retract his statement because he is misleading the House, because it is not the same day.
Mr. Scott PearmanI think the Honourable Premier has missed the spirit of the comment that I just made. And given it is the Christmas season, and given that we were about to explain the indulgences that the Opposition was giving to the Government, who tabled this Bill late, who only afforded a …
I think the Honourable Premier has missed the spirit of the comment that I just made. And given it is the Christmas season, and given that we were about to explain the indulgences that the Opposition was giving to the Government, who tabled this Bill late, who only afforded a meeting with the Opposition on Monday, and given that I was about to actually com-mend the Bill and commend his staff and commend the BMA, perhaps he might want to rethink his comment to the House. [ Inaudible interjections] Hon. E. David Burt: Mr. Speaker.
The SpeakerThe SpeakerLet us clarify. The issue is the Bill being tabled and done in one quick sitting is the point that you raised. The Bill was tabled — Hon. E. David Burt: Last week.
The SpeakerThe SpeakerThe Bill was tabled— Mr . Scott Pearman: I accept that this is being done on short notice. If that is the clarification— [ Inaudible interjections and general uproar ]
The SpeakerThe SpeakerNo, no. No, no. No, no. No, no. No, no. No, no. No, no. Members! Members! Members! Take your seat. Let me walk . . . I am going to walk you through this—nice and slow for everyone—so we will not have all of this back -and-forth. The Bill was …
No, no. No, no. No, no. No, no. No, no. No, no. No, no. Members! Members! Members! Take your seat. Let me walk . . . I am going to walk you through this—nice and slow for everyone—so we will not have all of this back -and-forth. The Bill was tabled last week at the last sitting. Am I correct? Mr . Scott Pearman: Correct.
The SpeakerThe SpeakerCorrect. Agreed by the House? Mr . Scott Pearman: Correct.
The SpeakerThe SpeakerIt is being debated today. Mr . Scott Pearman: Correct.
The SpeakerThe SpeakerWhat is wrong with that? In that that is the process for which Bills are to be tabled. [ Inaudible interjections] The Speaker: You have to sit. Wait. Wait. The minimum requirement is the seven- day period. And it has sat for seven days, and we are taking it up …
The SpeakerThe Speaker—and I made reference just now to a former Member who sat in this Chamber, Mr. Maxwell Burgess, who is in the Chamber today. Mr. Burgess would remember, like I do, that when we first sat in these Chambers we used to meet every seven days rather than the 14 …
—and I made reference just now to a former Member who sat in this Chamber, Mr. Maxwell Burgess, who is in the Chamber today. Mr. Burgess would remember, like I do, that when we first sat in these Chambers we used to meet every seven days rather than the 14 days in between. So, the fact that there is a 14 -day window in between some of the sittings today does not say that we cannot do a matter inside of seven days. And we are following the rules of the House. So, I do not see any reason for [anyone] to make an issue over something that is being done inside of the rules of the House. The rules state seven days; we are within seven days. End of story. End of story. Now I do take your point that you made that it is a long Bill. And I trust that your team has been able to grasp it in this short window, and we appreciate your being ready to debate it today. And we welcome the debate.
An Hon. Member An Hon. MemberNow that you got that clear.
The SpeakerThe SpeakerMembers, I need no assistance! None at all!
Mr. Scott PearmanThank you, Mr. Speaker. Mr. Speaker, we are extremely appreciative for the cooperation afforded— Hon. E. David Burt: Point of order, Mr. Speaker.
Mr. Scott PearmanSeriously? POINT OF ORDER Hon. E. David Burt: Mr. Speaker, the Honourable Member has not retracted the false statement where he said that a 70- page Bill was actually tabled and debated on the same day. He was misleading the House. He must retract the statement.
The SpeakerThe SpeakerI am expecting that he will lead into that now as he starts his remarks.
Mr. Scott PearmanI am happy to do so. And what I was about to do was thank the Members of the Ministry staff and the BMA, who af-forded us the opportunity of a meeting on Monday, it being Friday, on Monday to discuss the 72- page Bill. And I was about to …
I am happy to do so. And what I was about to do was thank the Members of the Ministry staff and the BMA, who af-forded us the opportunity of a meeting on Monday, it being Friday, on Monday to discuss the 72- page Bill. And I was about to be very nice and polite about it. But
Bermuda House of Assembly as the Premier wants to make an issue, I might just point out that leaving such an important piece of financial legislation to the last sitting of the year and not having it ready when it could have been ready and not bringing it forward and sharing it wit h the Opposition at an earlier time just shows how shambolic his leadership is.
[Inaudible interjections]
Mr. Scott PearmanAnd I stand by that point. And I appreciate very much the Corporation—
The SpeakerThe SpeakerNo, no, no, no, no. Wait, wait, wait, wait, wait, wait, wait, wait. I do not want to see it deteriorate to where we start having stones thrown across the room on a personal note. Do not kill the messenger. Deal with the message. And you have my full support …
No, no, no, no, no. Wait, wait, wait, wait, wait, wait, wait, wait. I do not want to see it deteriorate to where we start having stones thrown across the room on a personal note. Do not kill the messenger. Deal with the message. And you have my full support if you are dealing with the message. You will not have my support if you are starting to go after the messenger.
Mr. Scott PearmanNow first of all, I was trying to say I appreciate the cooperation of the Ministry of Finance and the members of the BMA who did afford us the opportunity of a meeting to explain a very long and de-tailed and complicated Bill. And we are extremely grateful for the …
Now first of all, I was trying to say I appreciate the cooperation of the Ministry of Finance and the members of the BMA who did afford us the opportunity of a meeting to explain a very long and de-tailed and complicated Bill. And we are extremely grateful for the opportunity that was afforded to us. I see that at least two of those persons are sitting in the Chamber today, and I am grateful for the presentation that we received on behalf of the BMA from Mr. Hughes. And I apologise if I have the surname incorrect, Mr. Archbold Muhle, who is part of the insurance team at the BMA. Additionally, Mr. Speaker, I would like to thank Pam Burrows of the Ministry of Finance for her presentation to us. Now, the Opposition is happy to move quickly on detailed financial Bills that afford an approach to bi-partisanship, notwithstanding that these are technical matters, when that is in the interest of Bermuda. And we see very clearly how this Bill is in the interest of Bermuda. And as mentioned earlier, we rather wish it had not been so last -minute, but we understand the importance of the legislation. And in a bipartisan fashion and demonstrating principled leadership and acting in the best interest of Bermud a, we are supportive of this Bill. Let me now turn very briefly just to the substance of it, Mr. Speaker. You have heard a very detailed presentation from the Honourable Wayne Furbert, MP, the Minister, who gave a very lengthy submission about what it is about. And I do not intend to repeat all of that. There are effectively two substantive things being done by this Bill. The first is that it is replacing the previous fee schedule. And although this replacement fee schedule in this amendment Act does contain some 300 fees, it is very import ant to repeat and re- emphasise the point already made by the Minister that a mere 70 of those 300 are in fact new. The previous 230- odd were already in the old legislation, but quite sensibly whoever prepared the amending Act took the view that the schedul e would be better to be wholesale replaced rather than be dealt with piecemeal. So that is one thing of two that this Bill is doing. The second is that it makes a discrete number of changes, three in fact, to the Insurance Act 1978. So, it makes some amendments to definitions to clarify certain points within that legislation. We asked and were assured that this was really for clarity. I t was not as a result of any difficulty with those points or any issues that had arisen. It was just that the matter was being clarified, and we take that at face value. Stepping back from the nuances of what this Bill is in fact doing, Mr. Speaker, it is really, as we understand it, driven in the whole by the growth in Bermuda of the life sector within the reinsurance and insurance sectors generally. That is something you will be familiar with, Mr. Speaker. I am sure most people in the House will be familiar with the growth in the life sector. And it is something that has been recognised outside of our shores in various other onshore jurisdictions and commented upon. And as it is the goal of the BMA to ensure that it provides the best possibl e scrutiny and regulation to this sector, the BMA naturally is looking for sufficient resources to be able to afford and do that scrutiny. And so that is quite proper, and we recognise that this requires funding. We are told that having met with ABIR and BILTIR, the representation bodies that represent the various insurance sectors, BILTIR being the life sector, that there is understanding and acceptance from BILTIR that this is necessary. And so it would appear that whilst no one likes more fees or taxes, the sector itself recog-nises the necessity of these additional costs and fees. So, we understand generally that the industry is not pressing against these amendments, and we rely on that representation in the limi ted time made available to us. I think beyond that, Mr. Speaker, there is very little more that needs to be said. The Opposition is supportive of the Bill. And whilst as I said we do not want to increase the cost of doing business in our jurisdiction, we also recognise that our jurisdic tion will live or die based upon its reputation and the ability of the reg-ulator to continue to do such a good job. So thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, MP. 260 15 December 2023 Official Hansard Report Bermuda House of Assembly Premier, you did not give me a chance to ask if there were any other speakers. You were up on your feet so quickly that time. Hon. E. David Burt: I wanted to make sure I …
The SpeakerThe SpeakerI assume you would like to make your contribution at this time. Go right ahead. Hon. E. David Burt: Mr. Speaker, I will just start by thanking the Honourable Minister for carrying this particular Bill for me today, as clearly, I have another major Bill that I am dealing with. …
I assume you would like to make your contribution at this time. Go right ahead.
Hon. E. David Burt: Mr. Speaker, I will just start by thanking the Honourable Minister for carrying this particular Bill for me today, as clearly, I have another major Bill that I am dealing with. But as there are a number of persons who are tuned in on the radio to listen t o a Corporate Income Tax Bill, I cannot allow the mischarac-terisations by the Honourable Member who just took his seat to take hold. And I am going to remind, as you have reminded, that Standing Orders require seven days between the firs t reading and second reading of a particular Bill unless by the rule or vote of the House. That is the first instance, Mr. Speaker. But I want to get to the second instance. There is absolutely no requirement for any department to give any briefing to Members of the Opposition on any par-ticular matter. And what happened in the Ministry of Finance last week Friday is, upon tabling the Bill, recognising, as I said to the Opposition Leader on numerous occasions, that we should stand hand to hand together across the aisle on matters of international business, I asked the Deputy Finance Secretary, Ms. Pam Bur-rows, to reach out to the Opposi tion to arrange a briefing so that they could be sufficiently briefed on that. It did not happen by accident. It happened by directive from the Minister of Finance as we were trying to ensure that there is understanding on major issues of pol-icy. The approach by the Honourable Member opposite I do not believe is in keeping with the matters inside of this House. He continues to want to say that things are being done in an untoward fashion. And as you have said, Mr. Speaker, it is in perfect keeping with the rules. And as I say on many occasions, Mr. Speaker, damned if you do, damned if you don’t . Follow the rules? They have a problem. Extend courtesy? They have a problem. What they need to do is to come up with the decorum and go and follow through with what it is that we do in this House. I wanted the record to reflect that it was the directive of the Minister of Finance to ensure that they were sufficiently briefed, as this is something that is particularly important. And if this is not something that they will welcome and try to use as a political tool in the future, I will happily, happily, happily have the officers in the Ministry of Finance do something else with their time to advance matters. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, Mr. Premier. Does any other Member . . . MP Dickinson, you have the floor.
Mr. Curtis L. DickinsonThank you, Mr. Speaker. Mr. Speaker, let me first start by declaring my interest. For the last 13 months I have served as an executive advisor to the Bermuda International Long Term Insurers and Reinsurers, who are impacted by this legislation. [Microphone adjustment]
Mr. Curtis L. DickinsonI am going to try to do a reset, Mr. Speaker, because I believe that this legislation is something that . . . notwithstanding the prior debate, it is something that we all can agree on. [Inaudible interjection]
Mr. Curtis L. DickinsonYes. Mr. Speaker, over the course of the last five years the growth in the long -term sector has been nothing short of exponential. And in some respects, we have been challenged to keep pace with the growth that is happening in the industry. And I think what is happening …
Yes. Mr. Speaker, over the course of the last five years the growth in the long -term sector has been nothing short of exponential. And in some respects, we have been challenged to keep pace with the growth that is happening in the industry. And I think what is happening with this legislation is BMA is now positioning itself to staff up to be able to provide the appropriate levels of regulation and oversight for the industry. One of my BMA colleagues is often known for saying that the BMA has to be credible, regulation has to be fit for purpose and it has to be effective. And with the fee increases generated from this legislation, the BMA will be positioned to hire the resourc es and to do what is required to ensure that this sector is properly regulated. Part of the things that are happening in the life space is that there has been a tremendous amount of innovation. With the innovation comes additional complexity. With complexity, you need to be sure that you are doing proper regulation.
Bermuda House of Assembly The Speaker: Mm-hmm.
Mr. Curtis L. DickinsonSo, I never intended to speak very long, but I lend my full support to this legislation. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, Honourable Member. Does any other Honourable Member wish to make a contribution? None? Minister. Hon. Wayne L. Furbert: Thank you, Mr. Speaker. And thanks to everyone for being involved this afternoon. And I thank the Honourable Members for their support. Mr. Speaker, the Honourable Member emphasised that the …
Thank you, Honourable Member. Does any other Honourable Member wish to make a contribution? None? Minister. Hon. Wayne L. Furbert: Thank you, Mr. Speaker. And thanks to everyone for being involved this afternoon. And I thank the Honourable Members for their support. Mr. Speaker, the Honourable Member emphasised that the Bill is long. Basically, the Bill is long, but the vast majority of it is contained within the fee schedule. And so the Bill itself, as far as the Bill, is only two pages and not 70 pages. Other parts had to do with the Schedule itself. It is the next Bill that we will debate that is long. The Bill is only coming forward now as extensive time was dedicated to successful consultation with all stakeholder groups. So that is why it has taken some time, no t that we were holding it up. Mr. Speaker, I move that the Bill be committed.
The SpeakerThe SpeakerThank you. Deputy. [Pause] House in Committee at 3:15 pm [Hon. Derrick V. Burgess, Sr., Chairman] COMMITTEE ON BILL BERMUDA MONETARY AUTHORITY AMENDMENT ACT 2023
The ChairmanChairmanHonourable Members, we are now in Committee of the whole for further consideration of the Bill entitled the Bermuda Monetary Authority Amendment Act 2023 . Minister, you have the floor. Hon. Wayne L. Furbert: Mr. Chairman, I would like to move all clauses, 1 through 5.
The ChairmanChairmanContinue. Hon. Wayne L. Furbert: Mr. Chairman, clause 1 provides for the citation of the Bill. Clause 2 amends the Fourth Schedule to the principal Act by deleting the entries in that Schedule applicable to the Insurance Act 1978. Mr. Chairman, clause 3 provides for Schedule 1, which amends the …
Continue.
Hon. Wayne L. Furbert: Mr. Chairman, clause 1 provides for the citation of the Bill. Clause 2 amends the Fourth Schedule to the principal Act by deleting the entries in that Schedule applicable to the Insurance Act 1978. Mr. Chairman, clause 3 provides for Schedule 1, which amends the principal Act to insert a new Fifth Schedule that is to provide for the fees to apply to the insurance industry. The new fee schedule inserted sets out existing fees payable by all registered and designated persons under the Insurance Act 1978 and additionally provides for annual business fees payable by the long- term sector with respect to the years 2024 through to 2026. Clause 4, Mr. Chairman, provides for Schedule 2, which sets out consequential amendments to the Insurance Act 1978. Section 1 is amended to cause the definition of “retail business” to apply to the entire In-surance Act 1978. Section 27F is amended to empow er the Authority to make rules in connection with the supervision of internationally active insurance groups (IAIGs). Section 27H is amended to make provision for IAIGs to pay a fee upon designation as an IAIG and thereafter to pay fees annually on or before the 31 st of March in every year. IAIG designation and annual fee amounts are proposed to be set out in the new Fifth Schedule to the principal Act under the heading “Insurance Act 1978.” Section 30JA is amended by deleting the definition of “retail business” in co nsequence of the amendment being made to section 1 relating to the definition of “retail business.” And clause 5, Mr. Chairman, provides for the commencement of the Act.
The ChairmanChairmanThank you, Minister. Any further speakers? There appear to be none. Minister, do you want to move the clauses? Hon. Wayne L. Furbert: Yes, Mr. Chairman. I move the clauses 1 through 5.
The ChairmanChairmanIt has been moved that clauses 1 through 5 be approved. Are there any objections? There appear to be none. Approved. [Motion carried: Clauses 1 through 5 passed.] Hon. Wayne L. Furbert: I move that the preamble be approved.
The ChairmanChairmanIt has been moved that the preamble be approved. Are there any objections to that? There appear to be none. Approved. Hon. Wayne L. Furbert: I move that the Bill be reported to the House as printed.
The ChairmanChairmanIt has been moved that the Bill be reported to the House as printed. Are there any objections to that? There appear to be none. 262 15 December 2023 Official Hansard Report Bermuda House of Assembly The Bill will be reported to the House. Mr. Speaker. Oh, one second before …
It has been moved that the Bill be reported to the House as printed. Are there any objections to that? There appear to be none. 262 15 December 2023 Official Hansard Report
Bermuda House of Assembly The Bill will be reported to the House. Mr. Speaker. Oh, one second before that. The Schedules.
Hon. Wayne L. Furbert: Yes, yes, yes, yes. That is very important. That was the most important thing, yes.
The ChairmanChairmanYes. [Inaudible interjections] Hon. Wayne L. Furbert: I move that the Schedules —
The ChairmanChairman—be approved? It has been moved that the Schedules be approved. Any objections to that? There appear to be none. Approved. [Motion carried: Schedules 1 and 2 passed.]
The ChairmanChairmanMr. Speaker, the Bill will be reported to the House. [Motion carried: The Bermuda Monetary Authority Amendment Act 2023 was considered by a Committee of the whole House and passed without amendments.]
The ChairmanChairmanMr. Speaker. House resumed at 3: 20 pm [Hon. Dennis P. Lister, Jr., Speaker, in the Chair] REPORT OF COMMITTEE BERMUDA MONETARY AUTHORITY AMENDMENT ACT 2023
The SpeakerThe SpeakerMembers, are there any objections to the Bill entitled the Bermuda Monetary Authority Amendment Act 2023 being reported to the House as printed? There are none. Thank you, Members. We will move on. And again adjusting the order, Order No. 5 is going to be done now as Order No. …
Members, are there any objections to the Bill entitled the Bermuda Monetary Authority Amendment Act 2023 being reported to the House as printed? There are none. Thank you, Members. We will move on. And again adjusting the order, Order No. 5 is going to be done now as Order No. 4. And it is the first, second and third reading of the Private Bill, Meanwhile Insurance Bitcoin (Bermuda) Limited Act 2023. And I believe MP Pearman is going to be presenting it.
Mr. Scott PearmanMeanwhile Insurance Bitcoin (Bermuda) Limited Act 2023. Mr. Speaker, I move that the following petition, together with the report of the Parliamentary Joint Select Committee on Private Bills, which was presented on the 15 th of December 2023, be now considered. The petition of Appleby Bermuda Ltd. for a Standard …
Meanwhile Insurance Bitcoin (Bermuda) Limited Act 2023. Mr. Speaker, I move that the following petition, together with the report of the Parliamentary Joint Select Committee on Private Bills, which was presented on the 15 th of December 2023, be now considered. The petition of Appleby Bermuda Ltd. for a Standard Crypto Insurance Bitcoin (Bermuda) Limited, an exempted company incorporated in Bermuda on the 3 rd of June 2022, requesting the enactment of provisions to provide it with flexibility in structuring its longterm insurance policies as set out in the Bill originally entitled “Standard Crypto Insurance Bitcoin (Bermuda) Limited Act 2022,” since revised and amended under the title “Meanwhile Insurance Bitcoin (Bermuda) Lim-ited Act 2023.”
The SpeakerThe SpeakerThank you. Continue. [Inaudible interjections]
Mr. Scott PearmanMr. Speaker, I move for leave to introduce and read for the first time by its title the following Private Bill entitled Meanwhile Insurance Bitcoin (Bermuda) Limited Act 2023.
Mr. Scott PearmanMr. Speaker, I move that the prayers of the petitioner be granted, and to give effect thereto that without prejudice leave being granted to bring in the proposed Bill reprinted to accord with the recommendations of the Parliamentary Joint Select Committee on Private Bills for the amendment thereof.
The SpeakerThe SpeakerOne sec, one sec, one sec. [Pause]
The SpeakerThe SpeakerYes. You know what? Okay. We did change the order because we should have done this third reading at the end of the day. But we have done the third reading. So, what you are doing should have been done then.
Mr. Scott PearmanSorry. I was just following your lead, Mr. Speaker.
The SpeakerThe SpeakerYes, I know. When we changed the order . . . Let me hold this until . . . let us complete the orders and [do this] when we do the third readings.
The SpeakerThe SpeakerBecause I am supposed to be responding to you, but at the third readings. Okay? So with that said, Premier, we will move on and do your matter. And that piece is included in the third readings. Okay? All those changes and adjustments, for those listening, was to accommodate the …
Because I am supposed to be responding to you, but at the third readings. Okay? So with that said, Premier, we will move on and do your matter. And that piece is included in the third readings. Okay? All those changes and adjustments, for those listening, was to accommodate the major Bill, which is why we are here this afternoon, which is the Corporate Income Tax Act 2023 which we expect to be of major discussion for this afternoon. And we appreciated the indulgence of the House to allow us to change the order of business that was done throughout the day to accommodate this Bill being done at this time. That is the last item rather than the first item. With that said, Premier, are you ready? Hon. E. David Burt: As ready as I will ever be, Mr. Speaker.
The SpeakerThe SpeakerOkay. SUSPENSION OF STANDING ORDER 29(1 ) Hon. E. David Burt: Thank you, Mr. Speaker. Mr. Speaker, I move that Standing Order 29(1) be suspended to enable the House to proceed with the second reading of the Bill entitled the Corporate In-come Tax Act 2023.
The SpeakerThe SpeakerContinue. Hon. E. David Burt: Thank you. Mr. Speaker, with the suspension of Standing Order 29(1), I move that the Bill entitled the Corporate Income Tax Act 2023, with the Governor’s recommendation, be now read for the second time. The Speaker: Are there any objections? There are none. Continue, Premier. …
Continue.
Hon. E. David Burt: Thank you. Mr. Speaker, with the suspension of Standing Order 29(1), I move that the Bill entitled the Corporate Income Tax Act 2023, with the Governor’s recommendation, be now read for the second time. The Speaker: Are there any objections? There are none. Continue, Premier.
[Motion carried: Standing Order 29(1) suspended.)
BILL
SECOND READING
CORPORATE INCOME TAX ACT 2023 Hon. E. David Burt: Thank you, Mr. Speaker. Mr. Speaker, it is my distinct honour and privilege on behalf of the Government to rise this afternoon in this Honourable House to read for the second time the Bill entitled the Corporate Income Tax Act 2023 which will bring Bermuda into line with new int ernational standards of taxation, fulfilling our commitment made in 2021 when Bermuda became a signatory to what has been widely referred to as the Global Minimum Tax Agreement. Mr. Speaker, this brief is divided into three parts where I should outline the following matters for Honourable Members and certainly the listening public: • first, to provide an introduction to the Bill, outline the purpose and the relevant background; • second, to review and summarise the important policy matters; and • third, to highlight some of the important technical provisions of the Bill and the policy and principles that underline these provisions.
Introduction
Hon. E. David Burt: Mr. Speaker, the debate of this legislation is of particular significance because it repre-sents promises made and fulfilled by this Government. This Bill fulfils the pledge made in the November 2023 Speech from the Throne to enact legislation that ensures that Bermuda complies with the G lobal Minimum Tax Agreement. The Bill fulfils pledges made to maintain Bermuda’s competitiveness as a quality international financial centre and to reinforce the Island’s hardearned reputation for transparency and international cooperation. The Bill continues to demonstrate the Government’s commitment to prudent fiscal management and sound economic policies and ensures that Bermuda’s longstanding reputation for quality is upheld. The purpose of this Bill is simple, and that is to implement a corporate income tax [CIT] that has a statutory tax rate of 15 per cent, which is consistent with the key requirements in the Global Minimum Tax Agreement. This tax is applicable to Bermuda bus inesses that are part of a multi -national enterprise group (hereinafter referred to as MNEs) with an annual reve-nue of at least € 750 million. 264 15 December 2023 Official Hansard Report
Bermuda House of Assembly Some background, Mr. Speaker. Since 2013, the Organisation for Economic Co- operation and Development (the OECD) in collaboration with a group of 20 industrialised countries (the G20) worked to address the issue of Base Erosion and P rofit-Shifting known as BEPS. In October 2021, over 135 inclusive framework members agreed on a two -pillar solution to reform international tax rules to ensure that large multi -national enterprise groups pay a minimum level of corporate tax in every jurisdiction in which they hav e a corporate footprint. This agreement is what is commonly referred to as the Global Minimum Tax Agreement. The Bill aligned with several key principles the Government identified in determining the way forward including to • maintain compliance with international standards; • apply a corporate income tax only to In Scope MNEs for Pillar Two; • design a tax regime to capture corporate income tax that would otherwise be payable to another jurisdiction; and • take active steps to ensure that Bermuda remains competitive and therefore encourages international business’s presence on the Island. Mr. Speaker, the Government worked collaboratively with tax, accounting and legal experts in international business to develop this legislation and will continue to do so as we chart the way forward. Today is just the first step in the development of the c orporate income tax regime. Next steps include the following: • First, a new or reformed body to collect these new taxes will need to be designed and implemented via legislation during 2024 following public consultation. • Key operational aspects must be in place by year-end 2024 with the intention for the corporate income tax being fully functional during 2025. • Various administrative aspects of the CIT regime will be developed and introduced in 2024 likely through a separate administrative Act covering Bermuda corporate return filing re-quirements such as formats, due dates, et cetera, covering other matters including Bermuda corporate tax return filing requirements, election requirements, compliance and enforcement requirements, and civil and criminal sanctions for non- compliance. • Work on the design and development of a qualified refundable tax credit regime will also occur in 2024, and details of this regime will be provided for later in this brief . • Work will also be completed on recommendations to ensure good governance over future tax revenues to be received and how to account for variability in tax receipts. This is work that is specific to the Tax Reform Commission’s mandate, which will be informed by the commissioners with submissions from the Fiscal Responsibility Panel and the Financial Policy Council. As highlighted in this year’s Budget Statement delivered in this Honourable House, the Ministry of Finance formed an International Tax Working Group consisting of specialists in international tax matters and representatives of various industry associations. This Working Group was tasked with examining how Bermuda should respond to the implementation of the OECD’s Pillar Two global minimum tax, taking into account the diversity and complexity of Bermuda’s international business sector. The group included memb ers from industry associations such as the Association of Bermuda International Companies, the Association of Bermuda Insurers and Reinsurers, Bermuda Interna-tional Long Term Insurers and Reinsurers, the Bermuda Bar Association and CPA Bermuda. In addition to examining how Bermuda should respond to the Global Minimum Tax Agreement, they were also tasked to provide input in relation to the creation of an effective and efficient framework that would uphold Bermuda’s attractiveness and continued compliance with existing commitments to both the OECD and the European Union. The International Tax Working Group considered three options to address challenges surrounding the Global Minium Tax [GMT]. Those were (1) retain Bermuda’s existing tax regime with no changes, thereby not implementing a Global Minimum Tax; (2) implement the GMT Pillar Two rules in their entirety; or (3) introduce a corporate income tax to tax the profits of Bermuda entities that would be I n Scope for the Global Minimum Tax. And as a reminder, when I say “In Scope for the Global Minimum Tax,” that means multi-national enterprises (or MNEs) with over € 750 million in annual revenue. The International Tax Working Group, having done a thorough assessment of the potential risks and benefits of each option, recommended to the Cabinet that Bermuda should choose option 3 by introducing a corporate income tax regime. As previously noted, a key consideration in deciding which path to take was the fact that under the Global Minimum Tax Agreement, companies that are In Scope are required to pay the minimum tax in every jurisdiction in which they have a corporate footprint. Therefore, if Bermuda did nothing, companies in Ber-muda would still have to pay the global minimum tax to another country while also paying their taxes and other relevant expenses in Bermuda for which they would get no tax relief in other countries. This would make it unattractive and expensive for companies to remain in Bermuda. Therefore, it was determined that Bermuda needed to create a tax regime so that companies could fulfil their commitments imposed by the global minimum tax in Bermuda in a way that would allow any such
Bermuda House of Assembly payments to be recognised under the global minimum tax framework. In light of the aforementioned, the Government considered all three options presented by the International Tax Working Group and agreed with the recom-mendation to go with option 3. Option 1 was not considered a viable alternative for Bermuda, given that taking a status quo approach would do nothing to assuage the concerns regarding the potential for double taxation in Bermuda and would be anticipated to erode Bermuda’s competitive position. Option 2 was also not considered a viable alternative, as adopting the global minimum tax Pillar Two rules in their entirety would mean that Bermuda would be potentially expanding its tax rights beyond Bermuda’s borders, taxing profits earned overseas by affiliates of Bermuda- based companies. This would go beyond the Government’s original stated intent of only taxing Bermuda- derived profits which would otherwise be paid to another jurisdiction. It should also be noted that developing the infrastructure to administer the entirety of the Pillar Two rules would be significant . Adopting a corporate income tax regime, or option 3, provides the most flexibility and allows for the introduction of policy -driven design features that will benefit Bermuda which are common in many other countries. It would also allow for appropriate intr oduction of transitional arrangements so that companies would not be severely disadvantaged by choosing to remain in a jurisdiction that did not previously have a corporate income tax regime.
Part 2: Policy Matters Hon. E. David Burt: Mr. Speaker, it is appropriate to discuss a few questions that repeatedly arise in public discourse. One consistent question is, How will this new corporate income tax affect Bermuda businesses? Local Bermuda businesses which are not part of large multi -lateral entities or multi -national entities will not be impacted by the proposed corporate income tax. The proposed Corporate Income Tax Act only affects large multi -national companies with revenues of €750 million or more. There are some who wish to scarem onger. Many of those persons are uninformed people online. But this point could not be clearer, because this Bill provides for the imposition of the corporate income tax to large multi -national companies only. Mr. Speaker, another question immediately asked and one that the same persons who will write in the daily newspaper and [who are] completely unknowledgeable will say, International business will pack up and leave if Bermuda implements this corporate income tax. False. Bermuda has consistently positioned itself internationally as a first -class international financial centre. For decades Bermuda has encouraged and welcomed quality businesses with robust business models and good governance to be established on the Island. We have encouraged economic substance along with the resulting economic impact on the country through greater economic activity. With the introduction of any proposed tax, companies will assess it from their own strategic and operational perspective. However, as highlighted previously, for companies that will fall into scope of the global minimum tax, if the company’s jurisdiction or domicile does not charge a 15 per cent minimum tax, that company will still be required to pay those taxes to another jurisdiction. So to put it simply, Mr. Speaker, it is important to reinforce that if Bermuda took option 1, as discussed earlier, and did nothing, as some jurisdictions have chosen to do, those companies would still be required to pay the tax to another jurisdiction whi le also paying their taxes in Bermuda. So, Mr. Speaker, the argument falls flat on its face because if a company were to move to a jurisdiction that decided not to implement a cover tax (that is, a tax recognised under the international rules), that company would still need to pay the global minimum tax. So, there is little benefit to moving to another jurisdiction due to the fact that this tax is a global tax. After the implementation of the global minimum tax, it will not be whether companies that are In Scope must pay the tax; but the question will be to which country they will pay it. It is the view of the International Tax Working Group and key constituents of the Bermuda international business sector supported by the Government that it is in Bermuda’s best interest to c reate a structure that will encourage companies who value Bermuda as their home to remain and continue to invest in Bermuda and pay taxes under the global minimum tax to Bermuda. That is the path Bermuda is embarking on through this legislation and the work that will continue through the next phases, which have already commenced. From the widespread consultations held thus far there is substantial support for the implementation of the corporate income tax from the international business community. And we expect this sector to continue to grow in the future. As this tax is global in nature, it will be important for Bermuda to compete in other areas, which is precisely the remit of the Tax Reform Commission, a matter I will touch on later, Mr. Speaker. Mr. Speaker, to quote Robert Moncrief, who is a global insurance international tax and transaction services leader for the EY region of The Bahamas, Bermuda, the British Virgin Islands and the Cayman Islands, and is ABIC’s representative on the International Tax Working Group, he said (and I quote), “ The zero rate was definitely an asset but it was never the driver for the majority of companies operating in Bermuda . . . Access to talent and the regulator were always more important, especially for the commercial [re] insurance industry. ” Mr. Speaker, the third question arising when this matter is discussed, and this is probably the most popular question, is, What are the projected revenues for the new corporate income tax? Mr. Speaker, the 266 15 December 2023 Official Hansard Report
Bermuda House of Assembly Government is modelling projected revenues with the assistance of external advisors and will provide detailed economic modelling and forecasting to further refine ranges of estimates in due course. As part of its terms of reference, the Tax Reform Commissi on will be making recommendation for a framework for appropriate tax credits. This is a feature that is common in other tax regimes and allowed for under the global minimum tax framework. Having an appropriate framework for such credits is key to ensuring that Bermuda remains competitive. However, Mr. Speaker, it is important to note that currently other countries are also reviewing their system of tax credits to introduce further incentives that are allowed for under the global minimum tax framework. Therefore, the Tax Reform Commission’s work in this area is certainly timely. The recommendations made for tax credits and other relevant changes proposed to the existing tax regime will have a material impact on the potential revenue associated with this initiative. It will also be important t o get a better understanding of the nature and type of actions taken by companies to address the introduction of the global minimum tax. For all of these reasons, it would not be prudent to place a definitive number on gross or net forecasted revenue from the proposed corporate income tax in the absence of those additional critical inputs which are not yet available. It must be highlighted that the regime will not come into force until 2025. Therefore, the Government has adequate time to refine its forecasting in time for the 2025/26 budget cycle, which is the earliest time that the government may receive revenue from this new tax. Mr. Speaker, though we cannot put a firm number on the estimated revenue, given the aforemen-tioned facts, the estimated annual revenue from the tax is likely to be substantial and in many years likely to exceed the collections that the government currently collects from payroll tax, which is now the single largest tax for the government. However, it is important to note that payroll tax collections are relatively stable and paid regardless of whether a company makes a profit or not. A corporate income tax i s by its very nature variable, especially when it comes to Bermuda’s main international business sector of insurance. There may be years where there are minimal catastrophe losses and the profits of Bermuda- based insurers are high leading to high tax collections. Conversely, there may be a season with multiple hurricanes that affect major population centres or another significant natural disaster which may significantly impact the profits of Bermuda- based insurers leading to low corporate income tax collections or even losses, which under tax accounting rules could result in no tax payable in the specific years and also reduce taxes for an ex-tended period of years, not just the year in which the tax losses were incurred. An important point, Mr. Speaker. This is why careful planning is needed by the Tax Reform Commission on how best to restructure existing taxes for this variability to ensure that after the implementation of this tax Bermuda as an international financial centre remains a competitive jurisd iction. And, Mr. Speaker, before I move on to the next question, I think that now would be a good time to talk about the proposed amendment that, at this time of reading, the Honourable Leader of the Opposition, despite my invitation to withdraw his amendment, has confirmed that the OBA will still advance this piece of what I term political theatre. Mr. Speaker, there is a significant amount of international work or of additional work that must be done to complete this new tax regime. And the action plan that I shared at the beginning of this brief notes that at the appropriate time work will be done on defin-ing guidelines and guard rails in relation to how funds should be administered and managed. Therefore, I can understand the perspective of the Opposition bringing this amendment. However, it is ill -timed as we are not there yet. In Committee, after my and other Members’ submissions today, if the Opposition still plans on advancing the amendment, I will happily dissect the amendment to state why the Government cannot accept it. However, at this time, Mr. Speaker, I would like to speak to the principl e of the amendment and why it should be withdrawn today. The Government has gone through great pains to ensure that we have a collaborative process, forming an International Tax Working Group of tax experts to advise the Government on the approach that we should take toward the implementation of Bermuda’s corpo-rate income tax. In addition, we have formed a Bi -Partisan Tax Reform Commission in which the Opposition Shadow Minister of Finance is a member. That body’s task and aim is to examine the very nature of the items that this amendment wishes to put in place. Mr. Speaker, there will be plenty of time to debate what to do with the projected revenues and what guardrails should be put in place around excess revenues and what those excess revenues should be used for. But I must posit, Mr. Speaker, that today is not that day. Mr. Speaker, if you would allow me, I would like to share for the information of Honourable Members and the members of the public who are listening the draft terms of reference for the Tax Reform Commission shared with me by the Chair of the Tax Reform Commission, Mr. Darren Johnston. May I, Mr. Speaker?
[No audible response] Hon. E. David Burt: Thank you, Mr. Speaker. “Mandate: The Tax Reform Commission has been tasked with considering additional revenues that may accrue to the Government of Bermuda due to the implementation of the corporate income tax and to
Bermuda House of Assembly make recommendations to the Government for the reduction, elimination, modification, replacement of existing taxes or consideration of new taxes. The commission is asked to consider and recommend a set of policy options with the aim of causing the Bermuda tax system to share the payments and benefits, including corporate income tax -related qualified refundable tax credits and other potential credits or reductions fairly and equitably; to maintain and if possible, enhance Bermuda’s global competitiveness; to broaden the tax base, reduce the variability of payments and consider alternate forms of taxes; to reduce the impact of taxes on the cost of living in Bermuda and consider how earners below a threshold of income might benefit from reduced taxes; and to consider how the Government’s revenue management can be improved including appropriate guard rails and approaches to fiscal optimisa-tion.” In closing, it says “the deliverable draft report that addresses the mandate and provides recommen-dations by June 30, 2024.” Now, Mr. Speaker, it is clear that the responsibility of the Tax Reform Commission is to examine the very matters of additional revenues that may accrue to the Government of Bermuda from the imposition of this new corporate tax and assess all options in a broadbased manner, taking into account the views of both political parties, local business, international business, our trade unions to come up with broad- based recommendations on the best way to fairly and equitably dis-tribute those proceeds. I would say, Mr. Speaker, that it is the absolute height of arrogance of the One Bermuda Alliance to be-lieve that it is their caucus and their caucus alone, and if I may be so blunt, it is as though it is the Three Musketeers of the OBA: Doug De Couto . . . sorry, the Honourable Senator who sits in another place, the Honour-able Member who speaks for Finance in this Chamber and the Opposition Leader who think that it is their right to be setting the policy priorities for the entirety of the country from thei r room above the Music Box. Mr. Speaker, it proves that they are far from ready for prime time, because to govern a country that is a sophisticated international business jurisdiction, you must consult and get broad- based feedback and acceptance on the recommendations that you are putting forward in light of a historic and fundamental change to the collection of taxation in this country. That, Mr. Speaker, was this Government’s approach and promise to the citizens of this country in its 2020 Elec-tion Manifesto. We have executed on that promise. We have residents who have come forward to volunteer their time to examine these issues in detail and make recommendations to the Government which will come to this Parliament for debate and so that we can discuss the totality of those issues. The unchecked arrogance, to believe that a small group of people representing the narrow interests of the One Bermuda Alliance can set what policy priorities of the country should be [is] patently offensive to the rest of the country, Mr. Speaker. What is more offensive, Mr. Speaker, is the fact that the Shadow Minister of Finance, who sits in another place, who represents the One Bermuda Alliance on the Tax Reform Commission, would put forward these items when he is a very member of that body who is consid ering the totality of those issues. Mr. Speaker, I do not understand why the OBA’s Three Musketeers believe that they know better than the entirety of the Tax Reform Commission. I do not understand why they believe they know better than the International Tax Working Group.
The SpeakerThe SpeakerPoint of order. POINT OF ORDER [Imputing improper motive]
Mr. Scott PearmanThe Honourable Premier is imputing improper motive.
The SpeakerThe SpeakerPremier, just be mindful of guidelines. Hon. E. David Burt: Thank you, Mr. Speaker. I am not imputing improper motive, Mr. Speaker. But if they are going to come here and bring an amendment, I will get to it in the brief. But bring an amendment on a body of …
Premier, just be mindful of guidelines.
Hon. E. David Burt: Thank you, Mr. Speaker. I am not imputing improper motive, Mr. Speaker. But if they are going to come here and bring an amendment, I will get to it in the brief. But bring an amendment on a body of which they have the opportunity to participate and to disregard the work. The statements in this brief are my opinion, and the Honourable Member can speak when he has his turn. So, Mr. Speaker, to repeat, I do not understand why the One Bermuda Alliance’s Three Musketeers be-lieve that they know better than the entirety of the Tax Reform Commission. I do not understand why they believe they know better than the International —
Mr. Scott PearmanPoint of order, Mr. Speaker. Point of order, Mr. Speaker.
The SpeakerThe SpeakerPoint of order. POINT OF ORDER [Imputing improper motive]
Mr. Scott PearmanYet again he is repeating the same statement and imputing improper motive. [Pause]
The SpeakerThe SpeakerYou give an opinion. The only thing that I may add to that would be to keep within the guide-lines— Hon. E. David Burt: I will go, Mr. Speaker. 268 15 December 2023 Official Hansard Report Bermuda House of Assembly The Speaker: And the little named pieces attached to individuals, …
You give an opinion. The only thing that I may add to that would be to keep within the guide-lines— Hon. E. David Burt: I will go, Mr. Speaker.
268 15 December 2023 Official Hansard Report
Bermuda House of Assembly The Speaker: And the little named pieces attached to individuals, you can leave that out.
Hon. E. David Burt: I got you, Mr. Speaker.
The SpeakerThe SpeakerBut just stay in the guidelines. Hon. E. David Burt: Mr. Speaker, I shall continue. Mr. Speaker, I may know many things. But what I do know is that I am not an expert in international taxation. And so why do these three think they know more than the experts? …
But just stay in the guidelines.
Hon. E. David Burt: Mr. Speaker, I shall continue. Mr. Speaker, I may know many things. But what I do know is that I am not an expert in international taxation. And so why do these three think they know more than the experts? Why do these three think that they should set the policy for the country? I coul d understand, Mr. Speaker, if they won a general election and had 30 seats in this Honourable House. But even this elected Government with 30 seats has the foresight to recognise that for changes like this you need to build consensus and have wide input and buy -in so that you can take into account the totality of all of the issues and come up with solutions that can take into account all of the issues the country is facing. Mr. Speaker, there will be plenty of time to debate what to do with these revenues, plenty of time to debate what guardrails should be put in place. How do we handle excess revenues which may come from sig-nificant tax collection years? But, Mr. Speaker, t hat time is not today. So rather than playing politics with an issue, putting forward an amendment that the Opposition Leader knows that this Government cannot accept for the reasons that I explained to him directly, to somehow attempt to score cheap political points by playing to their base is irresponsible. And guess what, Mr. Speaker? I know full well the game they are playing. They want to say the Progressive Labour Party cannot be trusted with money. It is a dog whistle to their politi-cal base. But it is laughable because i t is being done on a day when we repaid $50 million of debt, decreasing the gross debt figure for the first time in almost 20 years, reducing our interest expense by $2.4 million. And this stunt is being done a day after Moody’s — whom the One Bermuda Alliance themselves referred to as the gold standard of rating agencies —affirmed Bermuda’s sound credit ratings. So, Mr. Speaker, I would again implore the Leader of the One Bermuda Alliance to practice what he preaches and abide by the consultative process that this Government has laid out and have his Shadow Minister of Finance put forward his ideas to the Tax Reform Commission so that they can be discussed there. To circumvent this process and to bring what is a purely politically motivated stunt with a narrow amendment that was shared with the media even before it was shared with the Government Members of this Ho nourable House—
Mr. Scott PearmanPoint of order Mr. Speaker. Point of order, Mr. Speaker.
The SpeakerThe SpeakerPoint of order. Point of order. POINT OF ORDER [Misleading]
Mr. Scott PearmanThe Honourable Premier is misleading the House. The [amendment] was shared with this House and indeed with the Ministry of Finance before being released to the media only this morning. Hon. E. David Burt: Mr. Speaker, the Honourable Member is clearly, clearly, clearly, clearly . . . Maybe he had …
The Honourable Premier is misleading the House. The [amendment] was shared with this House and indeed with the Ministry of Finance before being released to the media only this morning. Hon. E. David Burt: Mr. Speaker, the Honourable Member is clearly, clearly, clearly, clearly . . . Maybe he had less sleep than I did last night, because earlier today he was talking about a Bill being tabled the same day and debated the same day. And now today he is talking about the fact that this thing was not shared with the media yesterday and with the Ministry of Finance. Patently false! You know why?
The SpeakerThe SpeakerPoint of order. POINT OF ORDER [Misleading]
Mr. Scott PearmanThe Honourable Premier is yet again misleading the House. The amendment to the Bill from the OBA was shared with you, Mr. Speaker, around eleven o’clock yesterday morning. It was shared with the Government around 11:30. That was yesterday . The amendment was not in fact released to the media …
The Honourable Premier is yet again misleading the House. The amendment to the Bill from the OBA was shared with you, Mr. Speaker, around eleven o’clock yesterday morning. It was shared with the Government around 11:30. That was yesterday . The amendment was not in fact released to the media until this morning. Hon. E. David Burt: So there we go, Mr. Speaker. There you have it. He is basically making the argument for me. Because yesterday the Shadow Minister of Fi-nance was at the news. And before we had even got the Bill —
The SpeakerThe SpeakerPoint of order. POINT OF ORDER [Misleading]
Mr. Scott PearmanThe Premier is yet again misleading the House. The Premier was provided with a copy of the OBA’s amendment before the Honourable Shadow Finance Minister spoke to the media. Hon. E. David Burt: Mr. Speaker, Mr. Speaker. I have the notes from and the email receipts. But here is what …
The Premier is yet again misleading the House. The Premier was provided with a copy of the OBA’s amendment before the Honourable Shadow Finance Minister spoke to the media.
Hon. E. David Burt: Mr. Speaker, Mr. Speaker. I have the notes from and the email receipts. But here is what I can say. They went to the media before they shared it with the Government. Went to the media before they shared it with the Government.
Mr. Scott PearmanPoint of order, Mr. Speaker. B ermuda House of Assembly POINT OF ORDER [Misleading]
Mr. Scott PearmanYet again the Honourable Premier is misleading this House. I had given you the times on which it was provided firstly to you as Honourable Speaker in this Parliament; secondly to the Ministry of Finance via his Whip; and only thirdly did the Honoura-ble Me mber go and do interviews …
The SpeakerThe SpeakerLet the timeline play itself out. I believe the Premier was talking to a timeline that he has there. Hon. E. David Burt: Mm-hmm. So what I will say, Mr. Speaker, is this stunt with an amendment that was shared with the media with a full media tour that hap-pened …
Let the timeline play itself out. I believe the Premier was talking to a timeline that he has there. Hon. E. David Burt: Mm-hmm. So what I will say, Mr. Speaker, is this stunt with an amendment that was shared with the media with a full media tour that hap-pened yesterday is an affront to the hard work of the members of the International Tax Working Group. It is an affront to the work of the members of the Tax Reform Commission. And the manner which it was done, Mr. Speaker, in my opinion is an affront to this Honour-able House. Now, Mr. Speaker, let me continue, because the next question that we are asked is, How will the Government reduce the cost of living in Bermuda? Mr. Speaker, in the 2023/24 budget speech, it was high-lighted that the Government did not intend for actions taken to address the corporate income tax to be revenue accretive, meaning that the policy position was to ensure that new revenues could be used to offset ex-isting taxes rather than to be layered on top of existing taxes. Adopting such a policy position allows for the Government to utilise the potential additional revenues to make other significant reforms to the current tax system where the existing tax system is a significant contributing factor to Bermuda’s cost of living and cost of doing business. In light of the anticipated implementation of the corporate income tax, as highlighted in their terms of reference noted previously, the Government will receive recommendations from the Tax Reform Commis-sion in 2024 that aim to reduce the cost of living and cost of doing business in Bermuda by the possible re-duction of existing taxes. This will encourage job crea-tion and stimulate the economy, enhancing Bermuda’s attractiveness as a jurisdiction to work and live. Mr. Speaker, finally, another practical question that is often posed is, How will the Government administer the new corporate tax? Mr. Speaker, to paraphrase a famous quote from Winston Churchill, Today is not the beginning of the end; it is the end of the beginning. This Bill today is just the start of the construction of Bermuda’s corporate income tax regime and there is still significant work that will need to be done to complete this regime. As men-tioned earlier, next year this Honourable House can ex-pect additional amendments to this Act that will make provision for the body that will be created to collect this new tax. The Govern ment will design and launch the body that will be capable of administering the complex income tax provision to large multi -national organisations operating across multiple business sectors for this new tax regime to function effectively. The Government recognises that the creation of the body to administer this regime within the required timeframes will be a challenging undertaking. Work is already underway. A public consultation of these mat-ters is planned for 2024 and Honourable Members should anticipate that legislation will come to this Chamber during next year’s budget session. Following the passage of legislation, the body will need to recruit the necessary resources and put in place the technical systems required to administer this new tax. The intention is for the body to be operating and functional when the legislation comes into effect in 2025, such that the Government is prepared to receive corporate income tax payments starting in 2025 and corporate income tax return filings that will be due in 2026. In addition, legislation supporting the various ad-ministrative aspects of the regime are required to be introduced in 2024, such as tax return filing requirements and compliance and enforcement requirements. Now, Mr. Speaker, I will move to the third and surprisingly, as you can imagine, most detailed section of the brief, which deals with the technical provisions. And there will be further explanations of some of these when we go into Committee. Technical Provisions Hon. E. David Burt: Mr. Speaker, the corporate income tax legislation contains technical tax terminology, mostly taken from the OECD GloBE [Model ] Rules (Pillar Two), which describes the process for calculating income tax payable, including the relevant adjustments allowed. There is an important point, Mr. Speaker, that I would like to address as it is a concern that I know was raised in the briefing and something that I have been followed up from an Honourable Member in the other place. And it deals with the specific regulat ionmaking power in the Act. In the Act, as written, the Minister responsible for the Act has broad scope to make regulations that do have the consequence of making amendments to the legislation. The reason for this is that the Government had a limited time frame to enact the legislation and with a matter as complicated [and] as technical as in-ternational tax matters, there is a possibility that minor refinements may need to be made to the legislation dur-ing periods when the House is not in session. This is necessary under the circumstances, but consistent with what would be appropriate for matters of this nature. I can assure this Honourable House, Mr. Speaker, that no substantive changes will be effected through this mechanism. And any substantive changes will be brought to the Legislature for appropriate examination and debate. 270 15 December 2023 Official Hansard Report
Bermuda House of Assembly Further, Mr. Speaker, I do anticipate that this power will be amended in the future for Bills that will allow for advance parliamentary scrutiny for the regulations, which is standard for tax regulations. And one of the reasons for that, Mr. Speaker, is t hat in 2025, after this regime is put in place, if there is something that is inside of legislation that allows a Minister to amend certain provisions due to negative [resolution] procedures, that is something that creates uncertainty and that goes against the very essence of what we are trying to do, which is to provide certainty. So, it is something that is in there. It is something that is necessary for the time being, but it is not something that we expect will be in there for the long term.
The SpeakerThe SpeakerMm-hmm. Imposition of Corporate Income Tax Hon. E. David Burt: Moving on to the imposition of corporate income tax. The Government believes that it is reasonable and proportionate for any new Bermuda corporate income tax regime that is based on the key requirements of the global minimum tax supersede any …
Mm-hmm.
Imposition of Corporate Income Tax Hon. E. David Burt: Moving on to the imposition of corporate income tax. The Government believes that it is reasonable and proportionate for any new Bermuda corporate income tax regime that is based on the key requirements of the global minimum tax supersede any existing tax assurance held by entities within the scope of the new Bermuda corporate income tax. This is reinforced by the fact that the Bermuda framework is based, to the extent appropriate, on the global rules de-veloped in relation to the global minimum tax agreement and is structured to pay tax that is payable under that regime. It is anticipated that such assurances would continue to apply for entities outside the scope of Ber-muda’s corporate income tax; however, assurances is-sued following the enactment of the corporate income tax would be adjusted to ensure consistency with th e provisions of the new regime. The Government be-lieves that it has a sound policy rationale for its position based upon three important factors that are further expounded on now, including: 1) responsible international citizen; 2) little difference between paying tax elsewhere and paying tax in Bermuda; and 3) tax assurance certificates. Mr. Speaker, Bermuda is recognised for its commitment to global compliance and transparency and is considered by the European Union [EU] to be a fully cooperative tax jurisdiction. Bermuda currently has 41 bilateral tax information exchange agreements and more than 125 multilateral treaty partners. Bermuda, along with over 138 other countries in the OECD G20 inclusive framework on BEPS [ Base Erosion and Profit Shifting] signed up to the two- pillar solution to address the tax challenges arising from digital isation and globalisation. The Government believes that this proposed tax regime is supportive of Bermuda’s status as a leading international financial centre. Implementing a corporate income tax based on these rules is a crucial step for Bermuda to demonstrate its commitment to international cooperation and responsible governance. And by aligning with global standards, Bermuda signals its willingness to cooperate with other countries in addressing the complexity of cross- border taxation. This approach reinforces the Island’s reputation for transparency and co operation which will maintain and further the competitiveness of Bermuda as a leading international business centre. Analysing the OECD’s Pillar Two global minimum tax rules and determining to implement a corporate income tax based on that agreement, it is a strategic and forward- thinking policy decision for Bermuda that goes beyond mere compliance. This move positions Bermuda as a responsible international actor while furthering domestic policy initiatives. The next topic I said I would cover under this, Mr. Speaker, is a little economic difference between paying tax elsewhere and paying tax in Bermuda.
The SpeakerThe SpeakerMm-hmm. Little Economic Difference Between Paying Tax Elsewhere and Paying in Bermuda Hon. E. David Burt: Mr. Speaker, at present the Government’s annual operating budget is funded by payroll taxes, customs duties, and various other taxes and fees. While the current system has historically proven to be relatively effective and …
Mm-hmm.
Little Economic Difference Between Paying Tax Elsewhere and Paying in Bermuda
Hon. E. David Burt: Mr. Speaker, at present the Government’s annual operating budget is funded by payroll taxes, customs duties, and various other taxes and fees. While the current system has historically proven to be relatively effective and a predictable means of funding g eneral government expenditure, none of the existing Bermuda taxes meet the requirement to be treated as covered taxes for calculating a jurisdictional effective tax rate for the purpose of the GloBE Rules. As a result many, if not all, multi- national groups within the scope of Pillar Two, with business operations in Bermuda will have jurisdictions outside of Bermuda seeking to collect top- up taxes on profits earned in Bermuda which may not have been taxed at an effective rate of at least 15 per cent. This top- up tax could be collected either from the shareholder under the Income Inclusion Rule [IIR] or from an affiliate under the Under Tax Payment Rule [UTPR]. For these groups, the tax on Bermuda profits may be payable to other jurisdictions if not collected in Bermuda. There is little economic difference between paying tax in Bermuda or paying that tax to foreign jurisdictions. Mr. Speaker, there are additional advantages that may flow from collecting tax in Bermuda rather than allowing it to be paid to foreign jurisdictions. Bermuda has the flexibility to restructure its existing tax systems, potentially reducing customs duties and payroll taxes which would in turn reduce the cost of living and cost of doing business in Bermuda. The proposed Corporate Income Tax Bill provides for qualified refundable tax credits [QRTCs], which is mentioned to present an opportunity for groups wh o have Bermuda entities to invest in a jurisdiction in a manner consistent with the Government’s policy objectives. As noted previously, the Government has embodied a tax reform
Bermuda House of Assembly commission to examine how best to reallocate tax revenues to support key policy initiatives including reductions in the cost of living, job creation and other programmes to stimulate the economy and enhance the jurisdictions attractiveness to multi -national enterprises [MNE]. The Government also believes that it is critical that the cost of living, doing business, and the ability to work in Bermuda are properly managed and it seizes the opportunities to increase the highly skilled jobs resident in Bermuda necessary to stimulat e the wider economy in the future while providing benefits to entities doing business from and within Bermuda.
Tax Assurance Certificates
Hon. E. David Burt: And the third matter, Mr. Speaker, is Tax Assurance Certificates. Mr. Speaker, Bermuda’s current consumptionbased tax system was developed in the 1800s and re-flected the expected scope and nature of expected eco-nomic and business activity at that time, given the Island’s size and position in the global landscape. This system was first codified in 1956 in the Exempted Undertakings Tax Protection Act which was subsequently re-enacted in 1966. In the intervening years the international tax landscape has changed dramatically. The development of what was to become the European Un-ion [EU] and the increase in the level of interest related to global tax policy in groups like the OECD have given rise to an interest in significant cross -border tax protection measures dating back to the commencement of the original OECD Base Erosion and Profit Shifting BEPS project in 2013. The BEPS project resulted in the agreement and publication of the BEPS reports in October 2015, marking a fundamental shift in the interna-tional tax landscape as regards the taxation of multi - national companies. T he reports commenced an intensive period of legislative changes across the European Union and OECD countries. In 2018, the OECD introduced measures requiring jurisdictions, including Bermuda, to maintain adequate economic substance for activities that involve mobile income and mandated increased transparency, disclosure and international tax cooperation. The most recent of those measures is a Pillar Two initiative, otherwise known as the global minimum tax. The stated policy aim of this measure is to subject profits of a multi - national group, regardless of the jurisdiction in which they are earned, to an effective tax rate of at least 15 per cent. Mr. Speaker, in this context, the Government believes that it is reasonable and proportionate for any new Bermuda- corporate income tax regime developed to appropriately reflect the requirements of the global minimum tax framework to supersede any existing tax assurance held by entities within the scope of the new Bermuda corporate income tax. Once enacted, the Corporate Income Tax Act will amend the Exempted Undertakings Tax Protection Act such that all certificates issued before or after the 1 st of Januar y 2024 will be subject to the corporate income tax. Moving forward, the process for applying and for issuing Tax Assurance Certificates will be the same, although new assurances will be adjusted to ensure consistency with the provisions of the new regime. (I only have seven pages left, Mr. Speaker.)
The SpeakerThe SpeakerGo ahead. In Scope Entities Hon. E. David Burt: Moving on to In Scope Entities. Mr. Speaker, the Bill makes provision for companies to be in scope for the corporate income tax if they are: • Bermuda constituent entities comprised of Bermuda tax resident entities; and • Bermuda permanent establishments …
Go ahead.
In Scope Entities Hon. E. David Burt: Moving on to In Scope Entities. Mr. Speaker, the Bill makes provision for companies to be in scope for the corporate income tax if they are: • Bermuda constituent entities comprised of Bermuda tax resident entities; and • Bermuda permanent establishments that are members of multi -national enterprise groups with consolidated annual revenue in excess of €750 million in at least two of the four preceding fiscal years. Bermuda constituent entities meeting this threshold will be subject to the Bermuda corporate income tax subject to certain exceptions, including a fiveyear deferral for multi -national enterprise groups with a limited international footprint (for example, presence in six or fewer jurisdictions); excluded entities, such as non-profit organisations or investment funds; and Bermuda entities that are less than 80 per cent owned by the ultimate parent of a multi -national enterprise group.
Foreign Tax Credits Hon. E. David Burt: Foreign tax credits. Mr. Speaker, the Government had considerable discussion with shareholders to analyse the approach to foreign tax credits in a responsible and reasonable way. While the Government continues to consider this issue, the legis-lation includes a two- year provision to mitigate the potential for double taxation in the near term, pending further developments in the global debate regarding the long-term approach to foreign tax credits. We are committed to monitoring the external environment for global developments on this issue and will react accordingly when things become clearer internationally. Now, Mr. Speaker, on to words that I have said so many times. It is so funny; my son even says it at home now. Qualified refundable tax credits.
[Laughter]
Qualified Refundable Tax Credits
Hon. E. David Burt: Mr. Speaker, the Bill makes provision to introduce qualified refundable tax credits which are allowed for under the global rules. As we have mentioned, the objective of these tax credits will 272 15 December 2023 Official Hansard Report
Bermuda House of Assembly be to support Bermuda’s economic goals and maintain the global attractiveness of the jurisdiction.
The SpeakerThe SpeakerMm-hmm. Hon. E. David Burt: In other jurisdictions it is common to offer specific tax credits to enhance jurisdictional competitiveness and to incentivise certain taxpayer behaviours. Given the relevant provisions of the GloBE Rules in this regard, countries are establishing qualified refundable tax credits under their global minimum tax compliant …
Mm-hmm.
Hon. E. David Burt: In other jurisdictions it is common to offer specific tax credits to enhance jurisdictional competitiveness and to incentivise certain taxpayer behaviours. Given the relevant provisions of the GloBE Rules in this regard, countries are establishing qualified refundable tax credits under their global minimum tax compliant framework. QRTCs offer benefits over other types of tax credits. In exchange for investments that meet QRTC requirements in specified investment areas, corporations will receive refundable tax credits. The Bermuda Government will determine the target investment areas such as development in the workforce, investments in Bermuda- based infrastructure, sustainability, innovation, housing, education, health care, or philanthropy. Qualified refundable tax credits are subject to specific eligibility criteria and they must be qualified under the GloBE R ules. If a tax credit is not used, it must be refunded within four years. Accordingly, appropriate legislative frameworks, governance and policy guardrails will be important to ensure reserves are maintained to pay for future qualified refundable tax credit refunds, as well as other matters related to this regime. So the important point in that to note, Mr. Speaker, is that if you collect the taxes you have to keep some aside. Because if you have to refund the taxes, then you need the money in order to make sure you pay back. As noted above, several jurisdictions have indicated their intention to develop QRTCs in the coming months and as I have stated, following recommendations from the Tax Reform Commission the Government will work to design, develop and model a qualified refundable tax credit regime for implementation in 2025. The required effort includes policy development, an additional public consultation prior to the introduction of legislation to this Honourable House to effect this policy proposal.
Definition of Taxable Income and Loss
Hon. E. David Burt: Definition of taxable income and loss. Mr. Speaker, for those Bermuda constituent entities that are liable for the corporate income tax, the first step in deriving the amount payable under the corporate income tax is the computation of taxable income or loss. In general, the computation of taxable income or loss for the cor porate income tax follows the GloBE Rules in that it starts with the financial statement of net income or loss and that adjusts such net income by pre-scribed taxable adjustments. Taxable adjustments incorporated into the corporate income tax are largely im-ported from the GloBe Rules. There are, however, certain additional adjustments provided for in the corporate income tax that properly transition the new corporate income tax into effect and address certain accounting mismatches that can occur for certain segments of our international business community. Now it gets very technical, Mr. Speaker.
The SpeakerThe SpeakerMm-hmm. Go ahead. Hon. E. David Burt: But I am advised that I must read this verbatim —
The SpeakerThe SpeakerYes. Hon. E. David Burt: —for matters of the future.
The SpeakerThe SpeakerGet it right. Get it right. Adjustments Due to International Financial Reporting Standard 17 (IFRS and LDTI) Hon. E. David Burt: Adjustments due to International Financial Reporting Standard 17, known as IFRS and LDTI. Mr. Speaker, the IFRS 17 adjustment mitigates issues associated with implementation of the IFRS 17 and …
Get it right. Get it right.
Adjustments Due to International Financial Reporting Standard 17 (IFRS and LDTI)
Hon. E. David Burt: Adjustments due to International Financial Reporting Standard 17, known as IFRS and LDTI. Mr. Speaker, the IFRS 17 adjustment mitigates issues associated with implementation of the IFRS 17 and LDTI in accordance with an acceptable financial accounting sta ndard. I will now provide for the details on the important impact of these matters. The implementation of IFRS 17 requires longterm insurers or reinsurers to measure insurance contracts using updated estimates and assumptions for purposes of preparing their financial statements. In transitioning to this new accounting standard, life rei nsurers are required to make certain adjustments to their financial statements to recast historic reporting to align with future accounting. The provisions in this Act ensure that the adjustments made to implement IFRS 17 do not provide a distorted result when applied to the computation of taxable income.
Economic T ransition Adjustment
Hon. E. David Burt: Mr. Speaker, the economic transition adjustment (or the ETA) provisions relate to the fair value adjustment for assets, including intangibles and liability. The purpose of the ETA provision is to revalue balance sheet items at fair market values as op-posed to historical carrying values for tax purposes. Companies will need to provide appropriate support for the values used. The principle behind this approach, which has been seen in other jurisdictions, is similar to transitional scenarios and it is to recognise upon entry into a taxing regime that the assets that will generate future taxable income may be undervalued.
Matching Adjustments Hon. E. David Burt: Mr. Speaker, the matching adjustments provisions mitigate potential accounting mis-matches applicable to long -term insurers. The matching adjustment provisions have the most significant
Bermuda House of Assembly impact on the life insurance sector. The provisions aim to address the concern that for some long- term life insurance contracts, the assets and liabilities reflected on the balance sheet are not accounted for on a consistent basis. The most common fact pat tern is assets being carried at fair market value and liabilities being carried under a prescribed reserving methodology that does not equate to fair market value. The result is a mismatch in the income statement, potentially causing distorted net income amounts. If uncorrected, this scenario could mean that life insurers experience a signifi-cant net income or losses in their financial statements which will translate to distorted results in the computation of taxable income or loss for the purposes of the corporate income tax. The Bill addresses this issue by allowing a Bermuda constituent entity to elect to match the asset and liability accounting in the computation of taxable income or loss for the purposes of the Bermuda corporate income tax.
Commencement
Hon. E. David Burt: Moving on to commencement, Mr. Speaker. Mr. Speaker, the corporate income tax legislation will come into force in its entirety on the 1 st of January 2025 and will be effective for tax years be-ginning on or after January 1, 2025, providing multi -national enterprises time for transition. However, an en-actment date on or before December 21, 2023, allows for companies to make the necessary elections in relation to tax residency, accounting standards or other relevant matters as well as requ ired accounting adjustments for effective transition on the commencement date. It is important to note that some elements of the legislation will come into force on the 1 st of January 2024 to ensure that certain elections of the nature noted above are properly recognised in foreign jurisdictions in 2024. An example of such an election would be a Bermuda company that wants to elect fiscal transparency entity status in 2024 such that a status is recognised internationally.
Conclusion
Hon. E. David Burt: In conclusion, Mr. Speaker, the Government believes that the corporate income tax framework reinforces Bermuda’s continuing commitment to global compliance and transparency and reinforces Bermuda’s strong international reputation. To-day would not have bee n possible without significant work done by members of the International Tax Working Group who have so ably represented their organisations and provided key input throughout this critical work. Special thanks go to the Association of Bermuda Insurers and R einsurers [ABIR], Bermuda International Long Term Insurers and Reinsurers [BILTIR], the Association of Bermuda International Companies [ABIC], CPA Bermuda, and the Bermuda Bar Association who supported the work of their representatives. We also wish to thank the firms by whom the members of the Working Group are employed who allowed for considerable man- hours and other resources to be invested in this project. Today, Mr. Speaker, is a landmark day in Bermuda’s history in this Honourable House, and one that has been achieved through collaboration, consultation, consideration and commitment. Mr. Speaker, I am honoured to serve as Minister of Finance during a time like this and I am privileged to work with a team of committed public officers who go the extra mile to ensure that Bermuda remains the envy of other jurisdictions. And I am grateful for all those persons in the Ministry of Finance, including our dedicated advisors, Mr. Collin Anderson and Mr. Michael Regan, who gave their time, energy and intellect to make to-day’s historic achievement a reality. I note the person who is responsible for drafting the brief did not include her name, but I want to give special recognition of course to the Acting Financial Secretary who will soon end her time in the Government of Bermuda, Ms. Cheryl -Ann Lister, for her outstanding leadership.
[Desk thumping] Hon. E. David Burt: The team of the Ministry of Finance were supported by the drafting team of the At-torney General’s Chambers who, led by the Honourable Attorney General, I must also express my sincere thanks. So, Mr. Speaker, on behalf of this Progressive Labour Party Government and in the name of all those who labour in the cause for a more fair and just society, I commend this historic Bill to this Honourable House. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, Premier. Does any other Member wish to make a contribution? MP Pearman, you have the floor.
Mr. Scott PearmanThank you, Mr. Speaker. Good afternoon and good afternoon to the listening public. I thank the Honourable Premier and Minister of Finance for the presentation just made to the House on what is indeed a historic Bill. Before I get into the substance, Mr. Speaker, just a few points of …
Thank you, Mr. Speaker. Good afternoon and good afternoon to the listening public. I thank the Honourable Premier and Minister of Finance for the presentation just made to the House on what is indeed a historic Bill. Before I get into the substance, Mr. Speaker, just a few points of housekeeping. First of all, I would like to commend all of those in the Chamber, including those who are not elected Members of the Chamber who had to read through this thing and work on i t. Because I have had to do so and it is a dense and thick text that has had a lot of thought poured into it. Second, Mr. Speaker, just for formality, I declare a very remote interest. A moment ago the Premier thanked a number of firms who contributed people to help out with this. I believe Conyers, where I am employed and a partner, lent someone to aid the Premi er 274 15 December 2023 Official Hansard Report
Bermuda House of Assembly in this as well. I had no personal involvement, but I recognise that Conyers had some involvement on the Bill. Third, I would say that although some of my colleagues may speak after me (I will wait and see about that) what I say now is on behalf of all of my col-leagues. So, this is the speech from the Opposition, if you will.
Mr. Scott PearmanAnd I am . . . MP Michael Dunkley has asked which I am — [Inaudible interjections]
Mr. Scott PearmanNo, I am Porthos, who of course was the fat one. [Laughter and inaudible interjections ]
Mr. Scott PearmanSo, there we go. Now, here we go. It is a historic Bill, Mr. Speaker. And certainly the biggest piece of legislation to come through this House during my short tenure. And I start with an observation about taxes, generally, or indeed, two. One is, once taxes come in, they …
So, there we go. Now, here we go. It is a historic Bill, Mr. Speaker. And certainly the biggest piece of legislation to come through this House during my short tenure. And I start with an observation about taxes, generally, or indeed, two. One is, once taxes come in, they usually stay in. It may well be known to most in this House that the concept of income tax was introduced in 1799. It was a war meas-ure. And it was imposed as a temporary measure because the war with France was getting so expensive and Pitt the Younger brought in income tax as a temporary measure. Not very temporary, I would say, Mr. Speaker.
Mr. Scott PearmanAnd likewise, it is a cliché, but it is timeworn and loved and that is, There are two certain-ties in life and that is indeed death and taxes. We as a political party on this side are truly committed to trying to reduce taxes. And we recognise that no matter …
And likewise, it is a cliché, but it is timeworn and loved and that is, There are two certain-ties in life and that is indeed death and taxes. We as a political party on this side are truly committed to trying to reduce taxes. And we recognise that no matter where you sit on the political spectrum it is very unlikely that anyone really wants taxes. Perhaps there are some, way over on one side, w ho think it is a great idea, but no one really wants more taxes. The OBA, for example, is committed to repeal the sugar tax and we stand by that. And we do so, Mr. Speaker, be-cause we as a party fundamentally believe that people are better able to manage t heir own money than governments are. So that is our starting point. Mr. Speaker, I want to get into context before I come on to the Bill. Context is this: Bermuda has a number of existing debts and financial obligations. These have been incurred over the past decades and it goes without saying, and I do not think I will be challenged, that we are currently over $3 billion in debt. That is a significant number. And it is a stranglehold on us. In terms of the annual cost of that debt, most in the House will be aware, but I will remind ourselves, it is over $130 million each y ear to service our debt. In addition, when one factors in our unfunded public sector pension obligations, the debt and pension obligations together come somewhere between $6 billion and $7 billion. So, it is a staggeringly large number. And that is a very important point of context in this debate. Another very important cornerstone of this debate is the international business sector and its su-preme importance to our Island. IB [international business] is more important than ever before and it was ex-tremely important before. Think for example of the support that international business lent to all of us here on this Island during COVID -19 where people were retained in their jobs and working from home even if their job did not permit them to work from home. So IB is an entity here to whom we owe a great deal. And you do not have to take my word for it. We have the pleasure of the 2023 Fiscal Responsibility Panel’s report being tabled today. And with your leave, Mr. Speaker, I would just point out that on page 3 of the report it is noted that our economy is, quote, “driven by international busi-ness.” End quote. And I do not think anyone in this Chamber would realistically debate that point. And so, in the face of the international business sector and bearing in mind the debts and obligations of this Government, the reality is that we have a context in which our Government is really ill -prepared to negotiate any better deal than the one that has been presented. And if you chose to go it alone it is always nice to have the financial wherewithal to be able to do so. And so we are truly at a forking path where we will see what this jurisdiction intends to do and will decide today, and what some other offshore jurisdictions will decide to do. And so, in a way, Mr. Speaker, we are not only first but, for the moment, we are alone. At least alone in terms of the offshore world. The reason I say
Bermuda House of Assembly that is that many, if not most, onshore countries already tax corporations and therefore this is something new to Bermuda. The Premier noted in his brief that there are some who have criticised and have said, Why rush? [It is] better to wait and see. And the answer given by the Government is this, and it is a powerful one: We are only looking to collect taxes in Bermuda that would be collected elsewhere if we do not. And I think that this is probably one of the strongest arguments in favour of this Bill. That if we do not collect this tax here, others will collect it elsewhere. And where is that happening? Well, it is happenin g in most onshore jurisdictions across the globe, as I have said. But it is not happening everywhere and that is why we are at a fork in the road. Where is it not happening, Mr. Speaker? Well, at the moment it does not appear to be happening in the United States of America. Now that could change, and it may well change. And we will have to wait and see in that regard.
Mr. Scott PearmanBut it should not be thought that this is the globe marching in lockstep. It is some, but it is not others. And we will not know whether it is the globe marching in lockstep for several years to come, perhaps. And that is an important thing because there is …
But it should not be thought that this is the globe marching in lockstep. It is some, but it is not others. And we will not know whether it is the globe marching in lockstep for several years to come, perhaps. And that is an important thing because there is an absence of certainty. There is an absence of clarity. There is a very realistic possibility that the terrain may change beneath our feet. And therefore, if we are going to march down this path, as it appears we are, we must tread carefully. Where is it also not happening, Mr. Speaker? Well, at this moment in time we are told, and of course things change, it may not be happening in that offshore financial centre to our south in Cayman. And of course, they are one of Bermuda’s bigger competitor s so it is important that we take a look and we see what path they are trodding down as well. We have also seen a back -pedal. It was going to progress in Switzerland. There were votes in several cantons but we have now seen what I will describe politely as a back -pedal by some in the Swiss Senate. And we have also, only this week, seen a statement from the United Nations where they have intervened to say, Actually, it may not be for the OECD to decide global tax policy. It may be for the United Nations and its new committee to decide global tax policy. Why do I say this, Mr. Speaker? I say this because not just do I agree with the Premier that it is historic and that there is much to play for, but I add the point that we do not necessarily know what the pitch we are playing on looks like and it may be ev er-changing. And the players may change and all of the players will have their own agendas and desires. So we are here, effectively, on the first step forward on a very delicate and complicated issue. And I am about to go into what we may gain and what we may lose, but just let me say this: Anyone who stands up and tells you that they know how this is going to turn out is not being straight. I do not know how this is going to turn out. You do not know how it is going to turn out. Even the Premier does not k now how it is going to turn out. And it may well be difficult with twists and turns. So, Mr. Speaker, what might we gain by doing this? The Premier has already identified that this will not apply to all of us in Bermuda. It will not even apply to all of the international business sector. As he rightly noted who is In Scope, it is those who make €750 million per annum in revenue. And there are other factors in there. He mentioned one. It has to be two in the past four years. There are some other detailed requirements to determine In Scope and that can be seen in the Bill itself. And we will come to that in Committee. And the phrase, I suspect, that we are going to be hearing quite a lot (just like the Premier’s son has heard about tax credits), I think we are going to be hearing the phrase, Is 15 [per cent] the new zero? Is 15 per cent tax going to be what was once described as the level playing field of the globe? Because if everybody has 15 per cent, then 15 per cent is the new zero. And if it is the new zero, and we are playing this game on a level playing field, then one could very well understand the merit of embar king down this path. If 15 [per cent] is to become the new zero.
Mr. Scott PearmanIf it does, we in the Opposition recognise that there is potential for upside here, and considerable potential. And I will come on to that on the amendment that the OBA is proposing today. But we must also say . . . and I hear from the Honourable Minister Mr. …
If it does, we in the Opposition recognise that there is potential for upside here, and considerable potential. And I will come on to that on the amendment that the OBA is proposing today. But we must also say . . . and I hear from the Honourable Minister Mr. Jason Hayward, that it would be voted down. Hon. Jason Hayward: Correct.
Mr. Scott PearmanI still believe that this is democracy and I still believe that it is for Parliament, not the Government, to decide the law of the day. So, there is potential for upside here and we recognise that. But let’s be clear. This potential is highly speculative. So let us not …
I still believe that this is democracy and I still believe that it is for Parliament, not the Government, to decide the law of the day. So, there is potential for upside here and we recognise that. But let’s be clear. This potential is highly speculative. So let us not try to utter falsehoods to give people the wrong impression that everything will be fine. Let us not try and suggest that no one will leave. We do not need to speak in extremes. We can just be straight. There is upside; it could be magnificent. But it is also speculative. So, if someone does stand up and say at some point in time that this is a silver bullet to solve all of our Island’s financial problems, I would respectively say, b e wary of that person. One huge fundamental here—and the Premier highlighted this and we entirely agree. One huge fundamental, indeed (it was highlighted earlier by the new Financial Secretary, as I understand she will be) . . . one fundamental will be the tax credits.
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Bermuda House of Assembly [Inaudible interjectio n]
Mr. Scott PearmanSorry. Did I mishear that? [Inaudible interjections]
Mr. Scott PearmanSorry to elevate you too soon. [Inaudible interjections and laughter ]
Mr. Scott PearmanThere we go. [Inaudible interjections and laughter ]
Mr. Scott PearmanYes, well, we are not going to deal with retractions. Let’s stay on a good line, shall we, Minister Hayward? One fundamental will be the identification of tax credits. And you will be hearing . . . we will be hearing a lot about tax credits just as the Premier’s …
Yes, well, we are not going to deal with retractions. Let’s stay on a good line, shall we, Minister Hayward? One fundamental will be the identification of tax credits. And you will be hearing . . . we will be hearing a lot about tax credits just as the Premier’s son has heard so much about it that he now says it himself at home. I am going to avoid calling them QRTCs because I think that kind of jargon can put people off. But when I am talking about qualified refundable tax credits, I am just going to call them tax credits. The words qualified and refundable are very important. They have their own special nuance, but I don’t think now is the time to go into those. What I will talk about is the prac-tical. Tax credits involve incentivisation . And so from that perspective both this jurisdiction and the other ju-risdictions that have been looking into them . . . And Mr. Speaker, there was a very interesting article in Bloomberg on the 7 th of December [2023] talking about tax credits and the various other jurisdictions that are looking at those, that I would commend to anyone in the room who has not read it, but they are complicated. So, yes, they are incentivised, but they are complicated. And it will involve prudent fiscal planning and cash re-serves. I will repeat that. It will be involving prudent fis-cal planning and cash reserves. Now, without throwing a stone, those are not things we necessarily have an abundance of here at the moment, certainly on the cash reserve side. And, just keeping it simple, the tax credits are decoupled from the taxes payable by the entity. So, it is not as if you could say, You are the biggest taxpayer in the land and therefore I will throw these credits your way. You have to decide the credits first. They are decoupled. And that is very important because that means you might be handing out tax credits and you might not get the tax back. You might not get what you hand out back. It is a gamble. It is complicated. It is speculative. And likewise, there is an added complication and that is this: Our primary international business industry, namely, insurance and reinsurance, manage their accounts in a very complicated way. And it is not unusual where the holding entity could have a zero year. And that is of concern because, of course, 15 per cent of zero is zero. They also have some complicated club act provisions on taxes where you can carry forward loses over a five- year period. I am not an accountant, and I am not going to pretend to explain all of that, but they can lose money in year one and they can trace that loss all the way up to year five. I know there are some accountants in the room, but I think that is how it works. So the point is, Mr. Speaker, that we are going to need a considerable period of time to know whether the path that we are embarking upon is the right path. It may not become apparent until after the fact. And in favour of the Bill is the equally important collateral point that if we do not embark on this Bill today, then those international business entities may not be able to take advantage of the accounting principles and mechanisms that are provided. So, we are effectively setting up two parallel tracks where they can take advantage of this. So we do need to do this now. It is not some-thing we can do in three or four years’ time and project backwards. And that’s important. And that is a very good argument in favour of the Bill. But if we are going to be deploying these tax credits successfully with reserves, then it is unlikely, I would respectfully suggest, that we will be dismantling the remainder of our tax system in Bermuda. So, just because a segment of international busines s may generate significant income (or may not) does not mean that tomorrow or in 2026 when these monies will start to be declared, or in 2027 or possibly late 2025 when they come in, that we can dismantle everything else and declare it a day. We certainly will not be able to do that. And so we may need to maintain a payroll tax for all others. So, again, be very wary of those who say that this is effectively dropping all of our fiscal responsibilities on the shoulders of international business and will solve our problems. Be wary of that.
The SpeakerThe SpeakerGentlemen. Gentlemen. Go ahead.
Mr. Scott PearmanI am told by the Premier that I am building straw men. What I am actually doing is setting out the facts because I do not tend to speak in hyper-bole and make false promises. [Inaudible interjections] B ermuda House of Assembly Mr. Scott Pearman: There will need to be …
I am told by the Premier that I am building straw men. What I am actually doing is setting out the facts because I do not tend to speak in hyper-bole and make false promises.
[Inaudible interjections]
B ermuda House of Assembly Mr. Scott Pearman: There will need to be assets held in reserve in order to pay the tax credits. And we need to recognise that there is an obligation to pay them re-gardless — [Inaudible interjections]
The SpeakerThe SpeakerYou are talking across him. I need to hear him.
Mr. Scott PearmanSo the Premier quite rightly said that these tax credits, these QRTCs, (please forgive the jargon) have benefits over other tax credits. No doubt that is true. But to be fair, they also have detriments over other tax credits. One is that they are complicated, and again, I don’t think …
So the Premier quite rightly said that these tax credits, these QRTCs, (please forgive the jargon) have benefits over other tax credits. No doubt that is true. But to be fair, they also have detriments over other tax credits. One is that they are complicated, and again, I don’t think that this is really a debatable point. But two, they will require cash reserves in order to refund them and those refunds to them might not come out of revenue if the revenue does not material-ise. Mr. Speaker, those are the benefits. In trying to be balanced about this I want to now turn to what we might lose by doing this. What happens to those who embark upon the other fork and go down the other path? Which some of our competitors have said they will do. Where does that leave us? Well, obviously, there are those who might leave. And I was curious in the last sitting of the House, or indeed, I think it was two sittings ago, as to what view the Government took about those who might leave. I put specifically a question to the Premier. And with your leave, I just say this: When I asked the Government if they had an estimate for how many entities might also leave Bermuda as a result of this tax, the Premier responded, no, he did not have an estimate for those who might leave. And when we were having our joint briefing of Parliament, the other place and this House earlier this week, it was rec-ognised that there are those who might not find this an amenable jurisdiction after the change in the law. And I think that recognition was a fair one and an accurate one. We really have not had a great deal of stress test on this. Yes, we are embarking down a path. Yes, it may be the best path that we can take given where we are and given the context we find ourselves in. But we have not had much in terms of stress test. And so that is one of the reasons why we are concerned that this may not prove to be the right path. But we are hopeful that if it is, and if revenue is generated as a re-sult, that it will be treated responsibly. There will be fis-cal responsibility. And, Mr. Speaker, with your leave, if I may, let me refer to the Fiscal Responsibility Panel report tabled today, the 2023 [Report]. And I would just quot e two points that they say. At page 3, this is the summary: “We therefore make a number of specific recommendations: “● Bermuda should make an early and binding commitment to use a substantial proportion of the net revenues from introducing a CIT for companies coming within the scope of the Global Minimum Tax to reduce Bermuda’s net debt, eventually converting it to a net asset po-sition. ” Early and binding commitment to reduce Bermuda’s net debt so we can convert it to a net asset position. That is one thing the Fiscal Responsibility Panel has specifically recommended. And over to a second one, Mr. Speaker, second and final recommendation on page 4, is this, and again I quote with your leave. “● We recommend that the above recommendations are enshrined in legislation on a fiscal framework. ” So we should reduce our debt we are told by the Fiscal Responsibility Panel and we should do it early and binding, early and binding commitment, and we should enshrine it in legislation. And that is exactly what we, the Opposition, are proposing by way of our amendment today.
The SpeakerThe SpeakerMm-hmm. Mr . Scott Pearman: That if there is a surplus, that that surplus be assigned to the reduction of debt first and second to our crumbling infrastructure. Another stress test that if not absent is certainly not very evident is the cost of implementation. And again with your leave, …
Mm-hmm. Mr . Scott Pearman: That if there is a surplus, that that surplus be assigned to the reduction of debt first and second to our crumbling infrastructure. Another stress test that if not absent is certainly not very evident is the cost of implementation. And again with your leave, Mr. Speaker, I asked the Premier two sittings ago what he thought would be the cost estimate for the administration of the tax c ollection being administered, and his answer was that the commission was looking into that issue. Well, what we have heard and what we see in this Bill is that there will be a new CITA, so there is go-ing to be a corporate income tax administration. It is going to be independent, and we are glad to see that it is going to be independent. And we hope that it is able to emulate the success that we have seen from the Ber-muda Monetary Authority. But let us be real. This is not going to come without considerable cost.
Mr. Scott PearmanAnd if tax revenue does not materialise, and we don’t know if it will and we don’t know if it won’t, but if it does not, this is an infrastructure that we are going to create at great cost. So, we like the fact that it is independent. And we …
And if tax revenue does not materialise, and we don’t know if it will and we don’t know if it won’t, but if it does not, this is an infrastructure that we are going to create at great cost. So, we like the fact that it is independent. And we recognise that there will be cost involved, but we need to be real about it. So the absence of stress testing is a concern. Additionally, if you look at the important part of this Bill, and it is a huge Bill, again, a lot of great thought 278 15 December 2023 Official Hansard Report Bermu da House of Assembly has gone into it. I commend those who have been involved. But one gaping hole is the fact that a lot of this will now be subject to the regulations. And we will deal with that a little bit in Committee. But I note immediately that we do not have the regulations. We have not seen them. We do not know if they exist. And indeed, much of what happens in relation to the regulations will happen through the Minister and subject to the negative resolution procedure. And we will comment on that in Committee. So, there we are. And I guess the moral of the story, Mr. Speaker, and I don’t have much more to say, but if you are going to jump out of an airplane, you had better be very careful who checks your parachute first. And you want to make sure that that person is someone in whom you have great faith. The other issue that does not appear to have been stress tested much, or certainly not to the satisfaction of the Opposition, is the issue of Tax Assurance Certificates. Now all of us in this Chamber and elsewhere will be aware that there are certain Tax Assurance Certificates that guarantee tax benefits to entities here in Bermuda until the year 2035. We have asked what will happen in relation to those. With respect, the answer is not clear, although if the Premier has a clear answer, perhaps he can respond at the end of the debate. But I will say this: It is very much hoped that a Tax Assurance Certificate will only be rescinded at the request of the beneficiary of the certificate. So if a particular entity says, Please, Government of Bermuda, I actually want to embark upon this global minimum tax. I want to pay the 15 per cent. I want to make sure that I am here. I am going to be here for long term. This is going to be legitimate. This is excellent. Please release me from this global Tax Assurance Certificate before 2035. We can see that. What would be very unwise, in our respectful submission, is if the Bermuda Government were to rescind these certificates contrary to the desire of a certificate holder and beneficiary entity. Now, I have already touched lightly on the issue of c ircumstances and speculation. And I guess my message to all of those who are listening, and it is probably not that many (it is a very complicated subject and tax is a bit dry), but it is be wary. Be wary . Because ultimately suc cess or failure will depend on the circumstanc es in the coming years, over the next several years, and we do not know what they will be. [Laughter]
Mr. Scott PearmanSo, not too long ago, in the 1980s , it was said that we were at the end of history.
Mr. Scott PearmanWe were remarking on the fact that peace had s uddenly broke out across the globe and we had put as ide the human behaviour that was so terrible. And we dec lared victory. And of course, how premature that was, Mr. Speaker, because now we stand here today with …
Mr. Scott PearmanAnd what I draw from that, as awful as that is, is that human nature can be variable. So, if people paint an overly simplistic picture, please be wary. It is complicated. There are twists; there are turns. The benefits may come, and we hope they do. But the potential …
And what I draw from that, as awful as that is, is that human nature can be variable. So, if people paint an overly simplistic picture, please be wary. It is complicated. There are twists; there are turns. The benefits may come, and we hope they do. But the potential for them is highly speculative. And historic mismanagement has not left us in a good place to negotiate. And to quote one of my colleagues, the Hon-ourable Craig Cannonier, MP, and former Premier, It is never a good thing when one’s inspiration is desperation.
Mr.
Scott PearmanSo beware. If you hear, No one will leave. Stop. Think. Of course, some will leave. If you hear, This will solve all our problems and you will never have to pay tax again because IB will pay. Stop. Think. Maybe, maybe if things go well. But also maybe not. …
So beware. If you hear, No one will leave. Stop. Think. Of course, some will leave. If you hear, This will solve all our problems and you will never have to pay tax again because IB will pay. Stop. Think. Maybe, maybe if things go well. But also maybe not. As I said, tax credits are the key here. They are complicated. They are tricky. There is also the issue as to whether or not tax credits will remain. That is the terrain that we see now. But the terrain may change. We have heard most recently from the OECD that they are in favour of supporting these tax credits. But that may change. [Inau dible interjections]
Mr.
Scott PearmanIndeed. So, it is not an inevitability. And anyone who says that it is an inevitability, I think I would ask them to rethink. That is a very easy argument to make. But it is not necessarily accurate. Again, I point to what I pointed to earlier —the United States, …
Indeed. So, it is not an inevitability. And anyone who says that it is an inevitability, I think I would ask them to rethink. That is a very easy argument to make. But it is not necessarily accurate. Again, I point to what I pointed to earlier —the United States, Cayman, Switzerland and now perhaps the UN, who might weigh in and change the entire terrain of the conversation we are having. So if someone says, We don’t have any choice, be wary about that. Now, we could have prepared all of this at the same time and said, Wait and see. I am not sure about that. I am not sure that that would have been the right approach. But make no mistake. Going first and alone in the offshore world has considerable risks. We should also note that this is not a done deal. We can still be flexible and nimble as required. And certainly the Opposition stands ready to assist Bermuda in being flexi-ble and nimble. Finally, let me turn to the amendment. We believe that governments need to be responsible and principled. And as I have already said, we are pleased to see that this tax will be administered by an
Bermuda House of Assembly independent body, the CITA. The key point here in favour of this Bill, and I say this less for the room than for the public audience, is this: If the tax is not paid here, it will likely be paid elsewhere. And by paying it here the international entities t hat pay this tax here in Bermuda will demonstrate yet further the legitimacy of this jurisdiction and we will also have the issue of tax credits, which will allow for flexibility and thinking.
Mr. Scott PearmanAnd again, because this is not a black -and-white, cut -and-dried issue, it is an issue with complication, let me say the key point against. The key point against is that there may well be a departure of international business for jurisdictions who say to t he OECD, No, we …
And again, because this is not a black -and-white, cut -and-dried issue, it is an issue with complication, let me say the key point against. The key point against is that there may well be a departure of international business for jurisdictions who say to t he OECD, No, we won’t. And at this moment in time, and it could change, the United States and Cayman are very much on that message. So, all Bermudians should very much hope that this will work. All of us! Because our financial lifeblood may well depend on it. And in terms of our amendment, we are told by the Premier —and as I say, we very much hope he is right —that this will bring incr eased revenue into Bermuda. And if he is right, let us therefore be responsible stewards of our economy, as we are advised to do by the Fiscal Responsibility Panel. So, if when the dust settles in 2026– 2027, somewhere in there, where we know that this was the right decision, where we know how many companies remained, when we know how many will be paying in . . . And let me just pause there. How many will be paying in is not certain either. We have heard it is somewhere between 400 and 500 of the groups. We heard previously it was 2,000 companies. I have heard that number has been adjusted to 1,200, but on our joint briefing of Parliament, we heard 400 to 500 groups. To my mind that sounds a little op-timistic, but I very much hope it is right. And I hope whoever has come up with that number has done their homework. So, if when the dust settles in 2026 or 2027, there proves to be any excess above the budgeted amount, then let’s apply it towards, one, reducing our stifling debt; and two, thereafter, attending to our crum-bling infrastructure. And again, I have read the statements to that effect, the endorsements from the Fiscal Responsibility Panel advocating that. Mr. Speaker, I would like to end where I started.
[Inaudible interjections]
Mr. Scott PearmanNobody . . . and I hear Thank God!, from the MP Jache Adams from behind me. Well, I am sorry that this was boring for you, sir. I will end where I started. Nobody wants more taxes. Yes, these taxes will be applied to a limited section of the …
Nobody . . . and I hear Thank God!, from the MP Jache Adams from behind me. Well, I am sorry that this was boring for you, sir. I will end where I started. Nobody wants more taxes. Yes, these taxes will be applied to a limited section of the international business sector. But as I have said, international business is extremely important to this Island’s economy. And I hope, and we hope this works. I hope and we hope that the estimate of 400 to 500 entities is correct. I hope and we hope that the absence of stress testing, identified in what I have just said, will be swiftly dealt with and focused upon be-cause, frankly, someone may leave and we want to know who they are and why so that we can try and persuade them to stay. So don’t ignore it; engage with it. Embrace it and try and stop it. Now, finally, Mr. Speaker, I would like to make it clear that the international business community through their agents and representatives, ABIR, ABIC, BILTIR, et cetera, have indicated support for this change, this fundamental change. And I would like t o end with this. The Premier in his brief quoted Robert Moncrieff, a well -regarded accountant at a very, very good Bermuda accountancy firm, who said that w hat is important is access to talent and access to our regulator. And those are the most important t hings. And I would just say, well said. We agree. And finally, I really cannot emphasise enough, I do not know (and I suspect perhaps not) whether everyone in this room has read this Bill. But it is slow going. It is difficult. A lot of work has gone into it. And for those who have struggled long hours, i ncluding one robed person that we sent out of Conyers, Well done for your hard work! So, Mr. Speaker, that is all I have to say. Thank you.
The SpeakerThe SpeakerThank you, MP Pearman. Does any other Member — Hon. E. David Burt: Mr. Speaker, I am just trying to quote Standing Orders, and if I may, after a particular Member takes his seat, I may rise. I would just ask if the Honourable Member could please just give—I did …
Thank you, MP Pearman. Does any other Member — Hon. E. David Burt: Mr. Speaker, I am just trying to quote Standing Orders, and if I may, after a particular Member takes his seat, I may rise. I would just ask if the Honourable Member could please just give—I did not want to interrupt his speech— a clarification as to where he saw the mention of a corporate income tax, that he could see in the legislation, as he said. Because we are trying to locate it so I can provide the necessary response. But we cannot find it.
Mr. Scott PearmanWell, all I can say, it was in there. We did receive some amendments. I do not know if it is no longer, but I thought that there was a Corporate Income Tax Authority in there. It was certainly discussed in the briefing. Is it not in the Bill?
An Hon. Member An Hon. MemberI don’t think so.
Mr. Scott PearmanIf I am wrong about that, I will absolutely accept that I am wrong about that. Certainly we have been told that there would be an independent Corporate Income Tax Authority (or agency) and we certainly . . . well, administration I am told by my colleague MP Susan Jackson. …
If I am wrong about that, I will absolutely accept that I am wrong about that. Certainly we have been told that there would be an independent Corporate Income Tax Authority (or agency) and we certainly . . . well, administration I am told by my colleague MP Susan Jackson. I had thought that that was in an earlier draft of the Bill. As I say, it was certainly 280 15 December 2023 Official Hansard Report
Bermuda House of Assembly discussed at the briefing. And if that is not the case, and if the — [Inaudible interjections]
Mr. Scott PearmanI’m sorry. Minister Hayward seems to be chirping from the side. I don’t know if it is something important —
The SpeakerThe SpeakerYou speak to me. Speak to me.
Mr. Scott Pearman—for him to say. He can speak later. But Honourable Premier, if that is not the case and if I am mistaken, then perhaps you could clarify whether or not there will be an independent agency as we had thought that there would be. Thank you.
The SpeakerThe SpeakerThank you. Now, does any . . . Minister Furbert? Hon. Wayne L. Furbert: Well, thank you, Mr. Speaker. This has been a very interesting half an hour, I guess, forty -five minutes from the Honourable Member. Mr. Speaker, the Honourable Member had to make me smile in many aspects …
Thank you. Now, does any . . . Minister Furbert?
Hon. Wayne L. Furbert: Well, thank you, Mr. Speaker. This has been a very interesting half an hour, I guess, forty -five minutes from the Honourable Member. Mr. Speaker, the Honourable Member had to make me smile in many aspects when he was speaking. I would just like to make . . . so the Member is aware that I am a qualified accountant —
Hon. Michael H. Dunkley: I haven’t heard you say that before.
[Laughter and inaudible interjections ]
Hon. Wayne L. Furbert: And interestingly enough, I — [Inaudible interjections and laughter ]
Hon. Wayne L. Furbert: And interestingly enough, I started taxes, income tax, for an individual I used to do some filing for, but it became very . . . for the United States filing, but it also became, as you know, it changes from time to time and I said . . . I put my hands up and said, I surrender. I am not going to get involved in that. But Mr. Speaker, the Honourable Member spent a lot of time, as far as I was concerned, trying to scare the public.
An Hon. Member An Hon. MemberYes. [Inaudible interjections] Hon. Wayne L. Furbert: Just trying to scare the public on what he thinks . . . what he thinks. There was no relevance as far as what was in the Bill. The kind words that . . . I thought I would have heard something from …
Yes.
[Inaudible interjections]
Hon. Wayne L. Furbert: Just trying to scare the public on what he thinks . . . what he thinks. There was no relevance as far as what was in the Bill. The kind words that . . . I thought I would have heard something from that honourable gentleman because it affects his business tremendously. But Mr. Speaker, why does this Honourable Member think he knows more than some of the best tax people in Bermuda? [Inaudible interjections]
The SpeakerThe SpeakerPoint of order. POINT OF ORDER [Imputing improper motive]
Mr. Scott PearmanHe is quite clearly imputing improper motive. I have never said that, nor do I think it. Hon. Wayne L. Furbert: Well, sure, he feels that way. [Laughter] Hon. Wayne L. Furbert: The Honourable Member feels that way. That he knows more than most honour-able tax people in Bermuda. The …
He is quite clearly imputing improper motive. I have never said that, nor do I think it.
Hon. Wayne L. Furbert: Well, sure, he feels that way.
[Laughter]
Hon. Wayne L. Furbert: The Honourable Member feels that way. That he knows more than most honour-able tax people in Bermuda. The Honourable Premier has put a significant . . . a team together, tax people, lawyers and whoever, to look particularly at this partic-ular advancement that we are working on. The whole idea of this Bill, it is historic. I have been in this place for 30 . . . Mr. Speaker, and yourself, over 30- some years. And who would have thought 33 years ago we would have even brought up the idea of corporate income tax . But, Mr. Speaker, this is where we are.
[Inaudible interjections]
Hon. Wayne L. Furbert: This is where—
[Laughter]
Hon. Wayne L. Furbert: I did not understand the Honourable Member. I did not hear him.
An Hon. Member An Hon. MemberTo be clarified. Hon. Wayne L. Furbert: No, I do not need a clarification from the Honourable Member Mr. Dunkley. I don’t need any clarification from the Honourable Member at all.
An Hon. Member An Hon. MemberDo you want a clarification, Mr. Speaker? Hon. Wayne L. Furbert: No, I don’t need a clarification. [Inaudible interjections and laughter ] Hon. Wayne L. Furbert: I said I have been in this Honourable House for 30- some years. [Inaudible interjections] B ermuda House of Assembly Hon. Wayne L. Furbert: …
An Hon. Member An Hon. MemberWhich s ide? [Inaudible interjections and laughter] Hon. Wayne L. Furbert: N ot your s ide. Not your side. [Inaudible interjections] Hon. Wayne L. Furbert: The Honourable Member should know that. [Inaudible interjections] Hon. Wayne L. Furbert: Mr. Speaker, the good book says that Where there is no vision, the …
Which s ide? [Inaudible interjections and laughter] Hon. Wayne L. Furbert: N ot your s ide. Not your side. [Inaudible interjections] Hon. Wayne L. Furbert: The Honourable Member should know that. [Inaudible interjections] Hon. Wayne L. Furbert: Mr. Speaker, the good book says that Where there is no vision, the people perish. [Inaudible interjections] [Gavel] Hon. Wayne L. Furbert: And s o for us to get involved in just hoping that something happens, wishing something would happen, the Honourable Premier and his team are looking at what could happen. And it is clear from the direction that we have been hearing for a while, from the OECD and others, that there will be a minimum tax. And if we would not . . . or if we had not done anything, or if we do not do anything, Mr. Speaker, that Honourable Member . . . that side will be saying that we are los ing our touch. What would they have done, Mr. Speaker?
An Hon. Member An Hon. MemberThey don’t have it. Hon. Wayne L. Furbert: What would they have done if they were in Government? Would they jus t be sitting around waiting for things to come about in the future? Waiting for the Cayman Is lands to dec ide what they are going to do? Waiting …
They don’t have it. Hon. Wayne L. Furbert: What would they have done if they were in Government? Would they jus t be sitting around waiting for things to come about in the future? Waiting for the Cayman Is lands to dec ide what they are going to do? Waiting for other islands to decide what they are going to do? We are a responsible Government. We are a responsible jurisdiction. And it is clear that if we don’t make any decisions, or at least prepare for them, Mr. Speak er, that we are letting the people of this country down. Mr. Speaker, as I said before, the Honourable Premier has put together a very intelligent team, looking at what the pos sibilities are.
An Hon. Member An Hon. MemberWayne, you want a c opy of the Bill? [Laughter] Hon. Wayne L. Furbert: Mr. Speaker, I know more about taxes than the Honourable Member there who knows . . . he just lives upon milk. [Inaudible interjec tions and laughter]
Some Hon. Members Some Hon. MembersTax cow. Hon. Wayne L. Furbert: Mr. Speak er, this Bill before us is 63 pages and 53 clauses. Mr. Speaker, the Bill speaks to corporate income tax charging provisions. It speaks to In Scope entities determination. It speaks to tax credits. It speaks to taxable loss, taxable adjustments, allocation …
Tax cow. Hon. Wayne L. Furbert: Mr. Speak er, this Bill before us is 63 pages and 53 clauses. Mr. Speaker, the Bill speaks to corporate income tax charging provisions. It speaks to In Scope entities determination. It speaks to tax credits. It speaks to taxable loss, taxable adjustments, allocation of taxable income or loss, c orporate structuring. Mr. Speaker, why is Bermuda proceeding in this direction? Why are we proceeding in this direction? It is simple, Mr. Speaker. We have to remain compliant, transparent, and in line with other international tax developments. This is new. As I said earlier, Mr. Speaker, we would not have been talking about this two, three years ago, four years ago, five years ago, ten years ago. The whole idea of where we are going right now, we have to as a Government plan for that direction. The OECD, the Organisation for Economic Co-o peration and Development, has been working on a global agreement regarding a minimum corporate tax. This agreement aims to set a floor on the corporate tax rates acros s different countries to ensure that multi-n ational companies pay a minimum level of tax regardless of where they operate. And the Premier, the Minister of Finance, has emphasised that over and over again. So, not the ques tion of whether the companies actually operate here or whether they operate in Cayman or whether they do not operate in Cayman. That is up to them. But s omewhere along the line, Mr. Speaker, thos e international companies will be taxed. And so, Mr. Speaker, to ensure . . . and the whole purpos e is to ensure a fairer distribution of tax burdens among the countries . That is the whole concept of it. So, Mr. Speak er, what are the real benefits of corporate tax? Well, there is a whole heap of benefits for it. Revenue generation. [Inaudible interjection] Hon. Wayne L. Furbert: Revenue generation. As you know, if we haven’t generated revenue, we cannot actually do infrastruc ture. We c an’t pay down our debt, et cetera, et cetera. Corporate taxes provide significant revenue for governments which can be used for public service, infrastructure and social welfare programmes. Mr. Speaker, c orporate income tax also deals with ec onomic redis tribution. Taxation on corporations allows for wealth distribution by collecting revenue to fund public services that benefits society as a whole. This whole aspect, Mr. Speaker, can allow the Government of today to reduce certain other expenses such as . . . tax on incoming, or milk . . . tax . . . milk is tax free, duty free, or other products. Hon. Michael H. Dunkley: You make it up as y ou go, you know. 282 15 December 2023 Official Hansard Report
Bermuda House of Assembly [Inaudible interjection]
Hon. Wayne L. Furbert: No, they do. [Inaudible interjections] Hon. Michael H. Dunkley: It’s dangerous.
Hon. Wayne L. Furbert: No, I’m not. I’m not. [Inaudible interjections and laughter ]
Hon. Wayne L. Furbert: We know that duty on milk is free. Hon. Michael H. Dunkley: Yes, but you are making stuff up. Hon. Wayne L. Furbert: No, I am saying in general.
Hon. Michael H. Dunkley: So what taxes are you going to reduce? Hon. Wayne L. Furbert: Mr. Speaker, the Honourable Member is saying, What taxes will we do? But that is the whole aspect of the tax committee. The tax commit-tee is looking at the whole aspect of where we are. Where do we stand? What will we do with those particular tax revenues ? It is not about for this Honourable House today to make an amendment to say that the surplus should go to a certain direction.
An Hon. Member An Hon. MemberWhy not? Hon. Wayne L. Furbert: We need to wait until the tax committee reports. And that is why we have in place these highly educated tax accountants, lawyers and that whole other group so that we look at what we are going to do with particular revenue. [Inaudible interjections] …
Why not? Hon. Wayne L. Furbert: We need to wait until the tax committee reports. And that is why we have in place these highly educated tax accountants, lawyers and that whole other group so that we look at what we are going to do with particular revenue. [Inaudible interjections] Hon. Wayne L. Furbert: Mr. Speaker, the Honourable Member wants us to make a decision today. Mr. Speaker, I do not support making that decision today.
[Inaudible interjection]
Hon. Wayne L. Furbert: I do not support making that decision today. And as I said before, because the Gov-ernment and the group are still looking at what we will be doing with it. And once that decision is made I am sure, Mr. Speaker, that somewhere within the decision, somethin g will be put on debt. The way I get the impression from the Honourable Members, from that [side], is that every surplus should go toward the debt. That is what I hear from the Honourable Members. That is the amendment which I hear from the honourable gentlemen from that side. Mr. Speaker, I do not think that is appropriate. Mr. Speaker, we have to be cognitive. We have to be aware of where we are at certain times. And so, Mr. Speaker, it is important that we distribute the additional revenue in certain aspects of it. And I believe that at the end of the day, Mr. Speaker, we w ill make that decision and the committee will report back on the whole idea of putting something on that particular debt situation. It is important. Mr. Speaker, the whole idea of whether companies will leave Bermuda, I think the Honourable Member is right. There may be some. But there will be some that come.
An Hon. Member An Hon. MemberHmmm. Hon. Wayne L. Furbert: Some may leave; some may come. Even as we sit here today, Mr. Speaker, there are companies that have actually left Bermuda for certain reasons, for some reason or the other, and re- located to other jurisdictions.
An Hon. Member An Hon. MemberLike who? Hon. Wayne L. Furbert: But, Mr. Speaker, also those companies have come in.
An Hon. Member An Hon. MemberGive me an example. Hon. Wayne L. Furbert: We have had a large increase in international business. The Honourable Member of Economic Development will report that — [Inaudible interjections] Hon. Wayne L. Furbert: —will be able to say that. We have had a significant growth in international business, Mr. Speaker, …
Give me an example.
Hon. Wayne L. Furbert: We have had a large increase in international business. The Honourable Member of Economic Development will report that — [Inaudible interjections]
Hon. Wayne L. Furbert: —will be able to say that. We have had a significant growth in international business, Mr. Speaker, over the last five years —significant growth in international business. And some of them, Mr. Speaker, who are coming now or are here who came last week or last month or this year, are well aware of the situation that they find themselves in that the Government of the day could be making a decision on a minimum tax revenue of 15 per cent. They knew that. They met around the boardroom tal king about what are the possibilities. They made those decisions. So when large companies came here in the last week or so . . . I remember hearing of a company that was leaving a certain country about three months ago. Now it’s in . . . jurisdiction. Mr. Speaker, they were well aware because they sit around there and tax plan. They talk about the benefit of going to Bermuda. What is in it for us? What is the implication of taxes that we will have to pay out? Well, Mr. Speaker, we have a jurisdiction that is highly sophisticated. We just had the Bermuda Monetary Authority here. Everybody is aware of the regulatory body that we have in Bermuda. And one of the reasons why they come here, Mr. Speaker, is because we have the infrastructure, the structure of the whole brain
Bermuda House of Assembly power within a very short 21 square miles —accountants, law firms, professionals —when it comes to other services. So, to just to make the decision that it is 15 per cent, Mr. Speaker, is not necessarily going to make them all leave. I believe, Mr. Speaker, for the ones I spoke to just yesterday, they are quite happy with the decision that this Government is making. They are satisfied. Now, they will make a decision. There are other companies that may not. We understand that. But I bel ieve deep in my heart that there are more companies that will stay in Bermuda than leave. And the benefits that we will reap from those particular companies are significant. Now, the Government said with the tax planning team that there are things that we will look at. We do not expect them to be paying payroll tax [and] at the same time paying a corporate income tax of 15 per cent. Now, how all that structure works out will be based on how the team works. They understand it. And let me just say to you . . . the Honourable Member said that, I believe earlier, that . . . about . . . the largest taxes . . . this Government has produced some of the largest taxes over this period. When the Honourable Member Curtis Dickinson was Minister, he reduced some of the taxes. The largest taxes were reduced by the Honourable Member Bob Richards. Why do you think he said, Does money grow on trees? We couldn’t pay our seniors. He would not even pay our seniors for years. Mr. Speaker, the payroll tax under the One Bermuda Alliance grew significantly. This Govern-ment has always been cognitive and conscious of taxes on this country. How do we at the end of the day make life better for people and the community overall? We have had the lowest tax decrease, under $45,000. I think we are down to 1.0 per cent or a half per cent since the Government was empowered. They were 4.5 per cent when we took over. So, Mr. Speaker, we are well aware. Bermuda is a first -class international financial centre. We have quality companies. We are well aware of some of the significant companies that are here in Bermuda. I do not have to name them because most of you would know them. Mr. Speaker, all companies . . . not all companies, those companies that fall In Scope will hav e to pay appropriate taxes to that particular jurisdiction. Mr. Speaker, the Honourable Member who spoke for the Opposition, is well aware that we have a top legal system, second to none. Mr. Speaker, we have a significant accounting system. I remember when I was younger the only companies that were [around] in those days were Gray and Kempe and a few other local names. But now we have the PwCs and we have the Coopers, the KPMGs and we have the Deloittes. We have the whole significant . . . we have the infrastructure and we have the brain power in Bermuda to move f orward. And of course, Mr. Speaker, geographic location. Want to hop over? By the time you eat your first pretzel coming from New York you are landed in Bermuda and [are] able to do some business. We have it. So, I don’t want the Honourable Member to try to send out these scare techniques, or scare propositions, for those individuals, those Bermudians and oth-ers who may not be quite informed about taxes. Because tax in general scare people. It does! It does. But, Mr. Speaker, I believe that we can manage this thing appropriately and get the response from the international business that we will get. And as the Honourable Member said, I believe he said this, that he spoke to BILTER and ABIC and ABIR and spoke to a ll those particular entities and they support it. So, I would rather have the Honourable Member speak positive, to send a positive message from this Honourable House that not everything will be perfect. I accept that. Not everything will be perfect. But we accept also, Mr. Speaker, that we are moving in the right direction. As I said before, Mr. Speaker, I wonder what they would do if they were in the position that we are now. They would be up saying the same things. The exact same things. We have to move forward. Now, are we moving forward before other jurisdictions? That is the decision we made. We made a decision that we are going to move forward. There is a time. It is not going to be taking effect tomorrow. It is not going to be taking effect in the next budget in April 2024. It is time. There are things that are going to be put in place by . . . and things I am sure are going to come back to this Honourable House to make further decisions on tax challenges or credits or a whole slew of things, Mr. Speaker. This Honourable House will be making the decision. But for us, Mr. Speaker, to just put an amendment down right now to say that we want all surplus . . . I think that is what the amendment . . . I haven’t seen the amendment . . . we want all surplus to go toward the debt, I think at this time is inappropriate. Mr. Speaker, I am delighted that the Premier and the Minister of Finance has brought this Bill to the House today. It helps to clarify, give clear direction to the international business on the thought pattern from the Government. And as I said, most of this information was not written by the Honourable Premier or written by the Ministry of Finance. It was written by intelligent individuals who know the direction that we must pre-serve, this jurisdiction. We accept that international business is about 27 per cent of our GDP, 5 per cent is only tourism —27 per cent. We are not planning to lose 27 per cent of our GDP. We know what it would take to ensure that we make this thing happen. So, Mr. Speaker, with my few words . . . I am going to say . . . I think I only got about nine minutes left. But Mr. Speaker, I support the Bill, Corporate Income Tax Act 2023. And I do not support the motion for the amendment being put down by the Opposition. Thank you.
The SpeakerThe SpeakerThank you, Minister Furbert. 284 15 December 2023 Official Hansard Report Bermuda House of Assembly Does any other Member wish to make a contribution at this time? As we are looking for other Members, let me remind you that it is 30- minute time limit on each Member now that …
Thank you, Minister Furbert. 284 15 December 2023 Official Hansard Report
Bermuda House of Assembly Does any other Member wish to make a contribution at this time? As we are looking for other Members, let me remind you that it is 30- minute time limit on each Member now that we are past the two opening. The Premier and the Shadow Minister had the hour. Everyone else is 30 minutes. Does any other Member wish to make a contribution at this time? Any other Member? Does any other Member wish to make a contribution? MP Dickinson, you have the floor.
Mr. Curtis L. DickinsonMr. Speaker, I had hoped to speak a little bit later, but so be it. Mr. Speaker, I guess there is a saying, Where is Waldo? Then I guess there is a question of, What does Curtis think? [Laughter]
Mr. Curtis L. DickinsonSo, from the start, Mr. Speaker, I would like to kind of announce that I am supportive of this legislation and supportive of what it is intending to do. It is my view that this is the right thing to do and our decision to embrace the OECD initiative is …
So, from the start, Mr. Speaker, I would like to kind of announce that I am supportive of this legislation and supportive of what it is intending to do. It is my view that this is the right thing to do and our decision to embrace the OECD initiative is not one that we came to lightly. It is very easy to exercise criticism with the benefit of hindsight. There are only two of us in this Chamber who have had the opportunity to serve as Minister of Finance. And serving as Minister of Fi nance, you become aware of a certain number of pressures that you face from external bodies, of the governments, and those pressures certainly factor into your decision- making. I appreciate some of the comments made earlier about the unknown. But if we ele ct the unknown to dissuade us from doing things that needed to be done, most of us would not leave our homes every day. I am comforted and so I set out to reason, Why am I supportive of this? Let me provide a little bit of historical perspective. Our consumption- based tax system has been in place for well over a century. It was done that way because it is easy to administer, easy to collect, easy on the taxpayer to be able to compute what they owe. And that system has evolved a little over time. But by and large it has stayed the same. This sys-tem was in place before captives came to Bermuda. It was in place before P&C [p roperty and c asualty ] companies came to Bermuda. It was in place before the advent of the life insurance and reinsurance sector. This is not the system that was designed to encourage people to engage in inappropriate behaviour. And a long time ago this country made the decision that we were going to be a quality jurisdiction. And in pursuit of being a quality jurisdiction, we did a number of things that some would say that were not in our best interests in the short term but have proven to be solid pillars of why Bermuda is a relevant jurisdiction today. And there are those in this Chamber who are responsible for providing the advice and the leadership in moving those initiatives forward. Mr. Speaker, the world . . . there is nothing more constant than change. And we certainly could put our heads in the sand and make believe that the world around us is not evolving. That has not been the thing that has helped us to maintain our premier position as an international financial centre. We have worked hard to innovate. We have worked hard to remain relevant, and that has stood us well. When the OECD initiative first came about, I was the Minister of Finance, during BEPS Pillar Two. And I can recall a meeting in the Finance Ministry’s boardroom where a local CEO of a large multi -national company came to see me with some of her colleagues from Washington to pick my brain around, What would the Government’s response to this initiative be ? And in a moment of, with the benefit of hindsight, probably too much openness I said what I was thinking. And I said, Maybe we should embrace this. It would help us to get rid of this moniker “tax haven” which we are not.
Mr. Curtis L. DickinsonThe hardest thing in the world to disprove is a negative. And notwithstanding all the work that Bermuda has done, notwithstanding all of the accolades that we have garnered from various international bodies around being a compliant, transparent jurisdiction, we still get tagged with the moniker “tax ha-ven.” And perhaps …
The hardest thing in the world to disprove is a negative. And notwithstanding all the work that Bermuda has done, notwithstanding all of the accolades that we have garnered from various international bodies around being a compliant, transparent jurisdiction, we still get tagged with the moniker “tax ha-ven.” And perhaps by embracing this those forces no longer have the opportunity to use that against us. Because anyone who believes that the economic substance was not about tax, is putting their fingers in their ears and singing La, la, la, la, la. And when that did not work, because we embraced it and it accrued to our benefit, something else came down the road. So my running joke in the Ministry of Finance, and even now, is, Oh, it’s Groundhog Day. They have done something. We have responded. We have suc-ceeded. Their plan did not work. They are going to try something else.
Mr. Curtis L. DickinsonAnd for today I am going to suspend my ability to kind of tell you what I think is going to come next, because I do not want to add any more clouds over this. But I think doing this is the right thing. And so I have told those …
And for today I am going to suspend my ability to kind of tell you what I think is going to come next, because I do not want to add any more clouds over this. But I think doing this is the right thing. And so I have told those people in my office, We should embrace it. We would just take the existing taxes and change them. We would not make this thing accretive. And those persons left my office and they went back and they reported (and I am sure he is lis-tening) to the head of ABIR. And I got a telephone call two days later and it was, What did you say?
Bermuda House of Assembly And I said, What are you talking about? And he recounted the conversation to me. And I said, Well, it wasn’t policy. It was just me talking out loud, thinking out loud. But that is probably the way this is going to end up. And at that moment I realised that in the job that I was in, I could not always say what I thought because my words take on a certain power. Having said that, I can recall being the guy on the front page of the FT [Financial Times] saying that our tax system is up to us to decide. It is a matter of sovereignty. And I said that because at that time our stakeholders in the OECD were still in a flux, were opposed to this. But with the benefit of more information we figured out a way that we could make this work for us. And when I announced to a handful of CEOs that I had made the decision to support the initiative, I said, We are going to make it Bermuda- appropriate. We are going to be broadly consultative, and this is not going to be accretive to your existing taxes. And so I am encouraged that having been gone from the Ministry of Finance for almost two years the promise that I made has by and large been fulfilled. The Government has been consultative. I have been in the shadows looking at this from a BILTER perspective. And the team has worked really hard with the people assembled by the Government to advise it on what the best options are. I am a financier by training; I am not a tax person. I dare say that no one in this Chamber is a tax person. And inasmuch as we hire people who do this day in and day out, we have to trust their advice. We have to challenge it, of course. But we have to trust it, because I believe that they want to continue to be here. And they would not advise us to do something that would adversely affect their own interest. I have no problem with that mind- set. So, sovereignty was an issue. The OECD then decided to go the way it went. But I think it is important that I perhaps correct the record. Because there has been some concern expressed about the United States and its position. Prior to January of 2021, the OECD BEPS Pillar Three initiative was going nowhere fast. The moment Joe Biden was sworn in as the President of the United States, the United States wrested control of this initiative and drove it forward. Those are the facts. I am the one who received the calls from the State Department encouraging us to support our friends. And so we understand that it may be stalled in the United States by virtue of the fact that they have a divided Congress, but the pressure to get this done came out of the US Treasury. And notwithstanding the United States being stuck, Europe was going to do what Europe wanted to do. And not many of the folks in this room (Ms. [Cheryl -Ann] Lister can sit here and put her head down and start smiling) have had to deal with the short Frenchman being very, very rude to you, telling you how you need to comply with an initiative that has not been fully fleshed out. And I know for a fact that as he was delivering his message to me, she was deep in prayer hoping that I would not respond in a way that I am very capable of responding. (I got her to laugh.) So, the pressures on Bermuda are coming from many, many places. And it is no small marvel that we are able to deal with that kind of energy, but also to make smart, prudent decisions around how we are going to respond to those pressures. The special sauce that we have here is the size of this country and the ability for business, Government and the regulator to work together. Not to set aside their individual agendas, but to also understand that there is a greater good. The BMA can be the best regulator in the world, but if it has no entities to regulate, what purpose does that serve? And so, we have worked really hard to figure out the Bermuda proposition. And I would say that this initiative does in some way change the value proposition for some companies. But I often say that regulation goes around the world either clockwise or counterclockwise. But one thing for sure: It goes around the world. And so there may be countries that decide not to do this. But companies will still have to pay the tax. And so our concern needs to be focused on the other elements of our value proposition because those become even more important. The regulator, who earlier today we propped up with amending their fee schedule to ensure that they can recruit adequate resourc es to be more effective. We need to do some things inside of government to ensure that we are more service oriented and can respond in a more timely fashion to the needs of our stakeholders. Our legal system continues to be reformed, upgraded to make sure that we remain relevant from a legal perspective, the intellectual capital which is the special sauce. We have to continue to invest in that from a Bermuda perspective but also attract more companies that are prepared to employ people here to enhance the B ermuda risk ecosystem. So, we have come to the conclusion . . . as the Premier said earlier on that we are at the beginning of the end . . . or at the end of the beginning. There is a lot of work that needs to be done over the course of the next 12 months to flesh out . . . and I call this legislation foundational. Remaining over the course of next year, we need to build the walls. And I have confidence in the team that has been assembled to guide us through this properly. Standing up a new tax administration is a daunting task for a country that doesn’t have one. But I believe that the people who we have hired to advise us would tell us honestly if they didn’t think it was possible that we can get this done. Mr. Speaker, on Tuesday night we had a briefing. And silly me thought there was some form of Chatham House Rules around what happens in those briefings. And last night in the news I saw my picture blasted on the television. And the funny thing is I had gone to Somerset last night . . . because for those people who don’t know, I am from Cooks Hill Road. And my aunt 286 15 December 2023 Official Hansard Report B ermuda House of Assembly makes my Christmas pie every year so I took her all the ingredients and she said, You have been on TV. And I was like, What’s she talking about? And so I go home and I watched the television last night at eleven o’clock and I saw the news and I will say this. I said what I said, and I stand by what I said. I would have been hopeful that my colleague would have tried to make whoever said what they said anonymous as opposed to trying to use me as a wedge issue. My record on fiscal prudence is clear for all to see. And in many ways I support the general tenor of what is trying to be accomplished. I am not going to quote Lloyd Bentsen when talking to Dan Quayle. But I will say this, Darren Johnston is a friend of mine. Darren Johnston used to lead the PwC office in Bermuda and in the Caribbean, and he now leads Orbis. I am very confident in Darren’s ability to advise us properly on how to use these proceeds, whatever they are, in a way that works to the best advantage of the people of Bermuda. So, I am prepared to wait and see what the Tax Reform Commission comes back with because one thing is for sure, whether we enact legislation today or tomorrow or next week the receipts are not coming until 2025, 2026. We have time. So there is no need to r ush. And one thing that did not get said about what I said is, This is an initiative that should engender bipartisanship of all of us because it is in Bermuda’s best interest to not be on somebody’s list. Because the European Union and some of the folks ov er there have no problem using the listing exercise to ensure that people comply with what it is that they want to do. So, let’s give it some time. The Government has indicated that they understand the nature of guard-rails. I put in a couple myself. And inasmuch as there is opportunity to expand the number of guardrails to ensure that we get to a place where we have greater flex-ibility fiscally, I am not sure anyone would object to that. So, let’s focus on the things that are really important, and that is the next phase of the development of this regime. Let’s focus on the things that continue to build on Bermuda’s strength as an innovator. Let’s do that really, really well. Because at the end of the day that accrues to the benefit of all of us. And so, I know the Colonel started with this and I think MP Pearman said it as well, I will end where I began. I am fully supportive of this legislation. I think it is the right thing for Bermuda. And it will put us in a better place. It certainly will change the way that we do things. But change does not necessarily have to be bad. We have gone from encouraging shipwrecks to growing onions and fishing, to now being a premier financial services economy. Every time someone has thrown a hurdle in our way, we have managed to navi-gate it. And I am not suggesting that I have a crystal ball into the future, but I do believe that in our DNA is an ability to kind of deal with challenge, work together and get things done for the benefit of our people. Thank you, Mr. Speaker. The Speaker: Thank you, MP. Does any other Member wish to make a contribution at this time? Minister Campbell. Hon. Vance Campbell: Thank you, Mr. Speaker. In picking up where my colleague who just sat down . . . I do appreciate his comments, and in picking up where he left off, y ou know, I do not believe that this will be the last challenge. So we will continue to have to be flexible, fleet-f ooted and adaptable to the future challenges that come our w ay. Now, Mr. Speaker, I would like to begin by thanking the public officers in the Ministry of Finance and in the Attorney General’s Chamber for their Herculean efforts in ensuring that this Bill was able to be tabled, and quick tabled previously, and debated today. I would also like to thank the members of the Working Group for their contributions to this most significant piece of legislation brought before this House for quite some time. Mr. Speaker, before determining whic h approach to take to the global minimum tax, a thorough risk and benefit analys is of all the options was undertaken by the aforementioned Working Group. There was consultation with a wide cross section of international tax experts to review the global minimum tax in detail, to recommend an efficient framework to upbuild Bermuda’s v alue proposition and continued compliance with existing commitments to the OECD and EU. Based on the recommendations of the Working Group, the Government decided to introduc e a corporate income tax regime as it was seen to be the most beneficial option in providing flexibility and allowing for the introduction of policy-d riven features which we find in many other countries. And these . . . obviously we were looking to benefit Bermuda. We are also hoping that this would lead to a regime that was equitable, effective, efficient, that kept us c ompetitive and had transparency. I think that is what people would want in a corporate income tax regime. I think the Bill before us today provides balance between what the OECD is looking for in their minimum tax rules, with a sound economic policy to maintain our competitiveness as a jurisdiction. In all likelihood the implementation of a CIT, corporate income tax, is likely to generate additional revenues to allow Government to restructure existing domestic taxes in the future with one of the goals to reduce cos t of liv ing. There is a hope that through this tax regime there will be the opportunity to include features that will encourage greater corporate investment in Bermuda in our priority areas . Some of whic h were mentioned earlier: infrastructure, housing, the environment, health care, and of course, the obvious, the reduction of our national debt. Mr. Speaker, it is proposed that the new tax will be enacted on or before December 31 and most of the provisions will go into effect on the 1st of January 2025.
Bermuda House of Assembly There are some provisions, Mr. Speaker, that will go into effect as of January [ 2025 ] and these will allow for a transitional period for those companies that are likely to be affected. Mr. Speaker, the first lot of taxes under this regime will not be due, payable, until 2026, based on the 2025 filing. So, it is important that we have this legislation in place as soon as possible. As has been mentioned by some of the previous speakers, t his is just the first phase, the first step. There are other steps to follow in a detailed action plan that has been established by the Government to ensure all aspects of the regime are in place by January 1, 2025. Mr. Speaker, this initiative has involved significant consultation in collaboration with all relevant stakeholders including the private sector, the legislature and relevant external entities. This Bill primarily fo-cuses on technical matters required by t he companies that will likely be affected by this so that they can have the appropriate transitional measures in place. The Government is looking at modelling projected reve-nues. No, we are not pushing ahead, assuming it is going to be millions of dollars. We are doing our proper due diligence by modelling projected revenues. Again, with the assistance of external advisors, external ex-perts. And this will provide detailed economic modelling and forecasting to further refine the ranges of estimates of revenu e in due course. Mr. Speaker, in light of the anticipated implementation of this corporate income tax, the Govern-ment will receive recommendations from the Tax Re-form Commission in 2024. And the aim is to reduce the cost of living and doing business in Bermuda. So, by reducing taxes we are not only looking to assist inter-national companies that will be affected by this, we are also looking to use and utilise and create avenues through this to reduce the cost of living for Mr. and Mrs. Smith, for Mr. and Mrs. Jones, for the young Tyrrells, the Browns, the everyday person. Why would we want to do this, Mr. Speaker? This will encourage job creation. That is why we want to do it. It will stimulate the economy. That is why we want to do it. It enhances Bermuda’s attractiveness as a jurisdiction to work and live. That is why we want to do it. Mr. Speaker, at its most basic, corporate income tax is complicated and highly technical. It is further complicated when you introduce matters such as tax credits. To address some of the concerns that were raised: Is there uncertainty? Are there unknowns? The answer to both questions is a resounding, Yes. However, in drafting this legislation the Government has consulted (as was mentioned earlier) with a wide range of tax experts, international tax experts. Why would we do this? Because they know more than we do in this area. That is one. They have the expertise, the knowledge, the experience. The second reason we would do that is that we are trying to reduce the uncertainty involved in the decisions that we are required to make in this area. And in providing their recommendations, Mr. Speaker, they would have presented the pros and cons, not only of the recommended course of action. They would have presented to the Government the pros and cons of all of the alternatives so that the Gov-ernment had the best information in order to make a decision and to support that decision. Why do we model results, Mr. Speaker? Because we want to see under different circumstances, different outcomes that might happen, what the anticipated results or range of results might be so that we can plan ahead. So, the Premier, the Minister of Finance, in his brief has not said that this will cure all of our financial ailments. I did not hear that today. And if I missed it, please let me know. Correct me. But it is an important opportunity to go a long way to reducing our debt, to improving our infrastructure, to reducing the cost of liv-ing for those who call Bermuda home. So even when the revenue starts to come in as a result of the passing of this legislation, we must as a Government, and we will, continue to be fiscally prudent. So, Mr. Speaker, I will conclude by going back to where I started and that is thanking the public officers in the Ministry of Finance and the Attorney General’s Chambers for their Herculean efforts in bringing this Bill and putting this Bill together. So t hank you, officers. And thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, Minister. Does any other Member wish to make a contribution? MP Adams. [Crosstalk]
The SpeakerThe SpeakerMP Adams, you have the floor.
Mr. Jache AdamsMr. Speaker, let me first, similar to Minister Campbell, let me first acknowledge the Herculean effort it took to get us to this point. I cannot thank the civil servants and members of the private sector enough for putting in the long hours and the double duties. For while in …
Mr. Speaker, let me first, similar to Minister Campbell, let me first acknowledge the Herculean effort it took to get us to this point. I cannot thank the civil servants and members of the private sector enough for putting in the long hours and the double duties. For while in the midst of a cyberattack, still managed to deliver what would have normally taken about two years, in less than five months. Mr. Speaker, far too often we are quick to complain or find fault or point fingers, but I think today, in particular, is the day we simply say Thank you, and show appreciation for the collective effort that led to this piece of legislation. Their commitment and dedication to the progression of this country is nothing short of exemplary and so I thought it would only be right to acknowledge it at the very beginning. Now, let’s have some fun.
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Bermuda House of Assembly [Inaudible interjections]
Mr. Jache AdamsMr. Speaker, today is the day we finally get to discuss the Corporate Income Tax Bill. To-day is the day we discuss fundamental tax reform for this country. Today is the day we pass a significant milestone that I believe will lead to a brighter and more prosperous future. Now, …
Mr. Speaker, today is the day we finally get to discuss the Corporate Income Tax Bill. To-day is the day we discuss fundamental tax reform for this country. Today is the day we pass a significant milestone that I believe will lead to a brighter and more prosperous future. Now, it does not take long to realise that the very mention of corporate income tax means different things to different people. When many think of corporate income tax the first thing they think of is the potential revenue increase for the Government which is then, as you can probably imagine, followed by suggestions of how to spend it. But for me, when I think of the corporate income tax, the first thing I think of is how it serves as a reminder of how small we really are. You see, because ultimately what happened was years ago large nations got together and amongst themselves decided to make a material change in the global tax system and effectively said to the rest of the world, including Bermuda, You must comply, or else. Mr. Speaker, let me be clear. Many believed that the global minimum tax would be the death blow to our economy. Many did not envision we were willing or even capable of restructuring our tax system. But in true Bermudian fashion, when faced with adversity , we stood tall. We adapted. We persevered. And so we are here today making the best of the circumstance. We are here today proudly making lemonade out of lemons. So now, let’s go a bit deeper. Because, yes, Mr. Speaker, there are incredible upsides to this opportunity. As the Premier mentioned, there is a real opportunity for the Government to see a material increase in our revenue which can be used to reduce the cost of living and cost of doing business. It can be used to improve our infrastructure. It can be used to reduce our debt. It can be used to invest in our education system. Mr. Speaker, the opportunities are endless. They are real and they are getting closer by the day. This is without question an exciting time for the country. Make no mistake about it. Significant change is on the horizon and this Bill is a major step in it coming to fruition. Mr. Speaker, I say the opportunities are endless but it must be noted that they are not yet defined. It is absolutely critical we understand this phase of legislation. And what we are debating today is meant to simply lay the groundwork for this tax regime. You see, there are more phases to be implemented, more analysis to be done, more discussions to be had, more de-cisions to be made. Which is why I am befuddled—
An Hon. Member An Hon. MemberBefuddled?
Mr. Jache Adams—as to why the OBA would come with a last -minute amendment that appears to try and circumvent the work of the Tax Reform Commission which the One Bermuda Alliance themselves are a part of. Mr. Speaker, the Government empanelled the Tax Reform Commission comprising of reputable accountants and lawyers …
—as to why the OBA would come with a last -minute amendment that appears to try and circumvent the work of the Tax Reform Commission which the One Bermuda Alliance themselves are a part of. Mr. Speaker, the Government empanelled the Tax Reform Commission comprising of reputable accountants and lawyers for the very purpose of having them evaluate the landscape and make recommendations as to how to best move forward. So, I ask the Op-position: What is so wrong with, at the very leas t, allowing them to do the work and waiting to hear what they have to say? Mr. Speaker, when it comes to corporate income tax, it is also imperative that such an opportunity is measured, appropriately managed and adequately resourced. Because I want everyone to know, just as we know, that nothing is promised. Now, I listened to MP Pearman earlier. But I am going to be different because I am not going to speak on the doom and gloom, but I think it is our responsibility to also highlight the risks and, therefore, the reason for a heightened level of fiscal prudence. First, let me be mindful that as a result of this legislation, there is a possibility that some companies will decide to leave Bermuda. We know this. The Combined Opposition knows this. And believe me, they cannot wait to make a headline if and when it happens. Allow me to reiterate. We are well aware that there are some companies that may decide to leave as a result of this legislation. In fact, it would be disingenuous to suggest otherwise. You see, it is not unfounded that such a significant change i n domestic taxation will cause Bermuda to no longer be a fit for some companies. Mr. Speaker, there will be naysayers who do their best to paint this legislation as the catalyst for a mass exodus of IB companies, but we will not be swayed by the Opposition, their media or the com-pletely biased bloggers. So in response, allow me to first assure the public that this Government has had extensive consultation with the relevant stakeholders throughout this entire process. I want the public to un-derstand that this legislation derived from the recommendations of our industry partners. I will s ay it again. Much of this legislation derived from their recommendations. Mr. Speaker, I also want to emphasise that during the press conference in August when the Premier announced the opening of the consultation phase regarding the corporate income tax, he was joined by and supported by ABIR, BILTIR and ABIC. The point I am making is that the Government did not get here in isolation. We are not dictating the process to anyone. We have involved a range of stakeholders fr om the very beginning and have gone to great lengths to invite the public to give feedback, including three consultation papers. And so although the risk of some companies leaving is real, we are confident that Bermuda will benefit far greater with the corporate income tax than without it, even if some decide to leave. Mr. Speaker, we are confident that as a result of our consultation efforts, Bermuda’s IB sector will re-main relatively stable and we will continue to thrive as the world’s risk capital.
B ermuda House of Assembly Mr. Speaker, another risk we should be aware of is the fact that (and I think MP Pearman mentioned it earlier) receiving corporate income tax from these companies is not a given each year. The reality is there is no guarantee these companies will make a profit every year, and so there is a real risk that there could be years where there is very little for the Government to tax. And so the challenge in those years is that we may be collecting very little, yet we will still have to pay our normal operating expenses. Our hospital will still need its grant. The interest on our debt will still need to be paid. Our seniors and disabled will still need financial assistance. Our children will still need to be educated. I think you get my point, Mr. Speaker. But the Government understands this, which, again, is pre-cisely why we empanelled the Tax Reform Commission to consider these and other risks with the understand-ing that they would present recommendations on how best to address and best mitigate. Now, I am walking a fine line as I will not preclude the commission’s recommendations, but it would be reasonable to assume that the Government will put together a regime that will require an appropriate portion of income collected to be set aside in a separate fund not to be touched unless such occurrences take place. Put simply, whatever we collect from this tax, I believe it is reasonable to assume that a portion will be set aside so that monies are available during what I would refer to as rainy days. [ Inaudible interjections] Mr . Jache Adams: Mr. Speaker, the details and criteria are being discussed. And as I think it was MP Dickinson who said we have the entire [year of] 2024 to get it right. Then, Mr. Speaker, there is the turn of the day if you will. There are also the qualified refundable tax credits. I really do not want this to be overlooked be-cause it is important. You see, tax credits are issued globally for a range of taxes for a range of reasons. And I say this, first, to establish that Bermuda, looking to introduce its own tax credit regime, is not a unique concept at all. Again, what we are debating today is meant to simply lay the groundwork for this tax regime. Again, the Tax Reform Commission has been empanelled and tasked with producing a report mid- 2024 where they will be making recommendations on how to best handle these tax credits. But to give an example of what is being considered, it is very likely that we may say to these MNEs [multi -national enterprises] , If you continue to employ a certain amount of people, you will be eligible to a tax credit. If you contribute to a green energy project around the Island, you would be eligible for a tax credit. If you invest in our entrepreneurs or if you donate to our charities, you would be eligible for a tax credit. I will reiterate, nothing is set in stone as of yet. I am simply giving examples of what is being considered. These tax credits are absolutely necessary to ensure Bermuda remains competitive with the rest of the world. But here is where it gets interesting because there could likely be a scenario where a company or companies suffer a loss and, therefore, contribut e nothing to the government coffers and yet still meet the requirement to be eligible for a tax credit. Now, Mr. Speaker, I already know there will be a group that believes the answer is easy. There will be some who believe that we should simply say to the companies that they have to pay a certain amount of taxes whether they are profitable or not. Or they believe that these companies can only receive tax credit s if they are contributing to the coffers. And so, to that I say we must always be mindful that we have to remain competitive. Mr. Speaker, one of the most difficult things I find during my canvassing is explaining to my constituents that we are far more mobile than ever before. And just as much as we brag about how well our IB sector is doing, there are countries around the world watching us and trying to replicate what we are doing. They are actively trying to win our business, and so a heavy - handed approach, I believe, would not be wise. To further the point, let me say this, many of the large shareholders of these international businesses do not live here. They do not have any historical or emotional connection to the Island. The only thing they care about is maximising shareholder value, and if these policies in Bermuda are restricting that, then they have no problem discussing alternative locations. And so again, the approach, as we see it, must be to find the optimum balance for us all. Mr. Speaker, at this point . . . I was going to address the OBA and their comments in the media, but I will sav e it for another day. I will begin to close by speaking on our record of fisc al prudence. I think it is important because if we are anticipating additional rev enue as a result of this tax reform, I think it is important that we speak about our ability to effectively manage the public purse. Mr. Speak er, it cannot be refuted that the Government has been reducing our deficits every y ear since the pandemic so much so that the Premier will be announc ing a balanced budget for the first time in over 20 years. We are no longer discussing a balanced budget. We will deliver one next fiscal year. Mr. Speaker, the Gov - ernment has repaid $50 million towards our national debt. Hon. E. David Burt: Today!
Mr. Jache AdamsWe can get political where the PLP blames the OBA, and the OBA blames the PLP regarding our debt, but again, not one person can deny that as a result of this Government consistently outperforming expectations, we have now positioned ourselves on 290 15 December 2023 Official Hansard Report Bermuda …
We can get political where the PLP blames the OBA, and the OBA blames the PLP regarding our debt, but again, not one person can deny that as a result of this Government consistently outperforming expectations, we have now positioned ourselves on 290 15 December 2023 Official Hansard Report
Bermuda House of Assembly the path towards reducing our debt. Mr. Speaker, we have maintained our credit ratings. This means several world -leading rating agencies have independently evaluated the local economic climate, Government’s poli-cies and their effectiveness, and the overall trajectory where we are headed, and each of these agencies has complimented this Government on its performance. Mr. Speaker, our GDP has surpassed pre- pandemic levels. Unemployment has declined. Our tourism figures are improving. Construction has started at Fairmont Southampton. Mr. Speaker, I am fully aware that there will be those determined to find fault in anything we do, those determined to see the negative in anything we put forth. But believe it or not, I am just as aware that there are those who understand and are excited about the opportunities of this corporate income tax. And we will con-tinue to deliver for the people of Bermuda. Mr. Speaker, Barack Obama once said, “The future rewards those who press on.” And press on is exactly what we will do. Thank you.
The SpeakerThe SpeakerThank you, MP Adams. Does any other Member wish to make a contribution at this time? MP Dunkley, you have the floor. Hon. Michael H. Dunkley: Mr. Speaker, thank you and good evening. I managed to get my waiver from my col-league who spoke before me. Mr. Speaker, let me …
Thank you, MP Adams. Does any other Member wish to make a contribution at this time? MP Dunkley, you have the floor.
Hon. Michael H. Dunkley: Mr. Speaker, thank you and good evening. I managed to get my waiver from my col-league who spoke before me. Mr. Speaker, let me first start, as everyone else has through this debate, by congratulating the team who worked tirelessly day and night to make this hap-pen. As a Member of this Chamber for a long time and as a former Premier Minister, I am well aware of the challenges, the struggles, the hard work, the long hours and, quite often, the lack of appreciation for what is done. But certainly, I join the chorus of voices in thanking you for your work. Also, I want to be very careful in what I say because I do not want to get quoted too far and wide, but I appreciate the consultative and the collaborative approach by this Government.
An Hon. Member An Hon. MemberThat’s my boy. [Laughter] Hon. Michael H. Dunkley: I’m not finished. Hon. E. David Burt: It’s okay to tell the truth. Hon. Michael H. Dunkley: The Premier said, It’s okay to the truth. I do tell the truth. I endeavour to tell the truth all the time, but I speak …
That’s my boy.
[Laughter]
Hon. Michael H. Dunkley: I’m not finished.
Hon. E. David Burt: It’s okay to tell the truth.
Hon. Michael H. Dunkley: The Premier said, It’s okay to the truth. I do tell the truth. I endeavour to tell the truth all the time, but I speak from the heart and I also am not afraid to say things that might not be appreci-ated by the other side. But Mr. Speaker, why wouldn’t we take the collaborative approach because of the talent that we have on the Island? And it was talked about by the Premier earlier in the debate—the talent that we have on the Island. But more importantly, Mr. Speaker, (and I want to dwell on this for just a few brief moments) the importance of international business to our community. And sometimes I think that we forget about how the wheel turns in Bermuda and the importance from time to time of who actually has their shoulder to the wheel and who is really making it turn. Mr. Speaker, it is very clear to me and, I am sure, to all colleagues in the House but perhaps not so for many in the community on just how important international business is to our community. And this is where, I think, the importance to our community for international business has grown through the trials and tribulations and the years we had to struggle through COVID -19. You know, as I have said in this Chamber before and I said to my colleagues on a number of occasions, we have been blessed to have international businesses that were able to adapt quickly to the challenges imposed by COVID -19, working from home. They managed to continue to do their business and they managed to be successful in what they were doing. So international business has continued to grow in stature for our community. And both sides of the House , no matter what positions they sat in, whether in Gov-ernment or Opposition, have worked fairly well with international business to allow them to have a footprint to continue to expand and to be successful. That is why it is critical that we get this right today because we did not have many options. We had three options, as the Premier elaborated on earlier today. And we in the Opposition have said that we agreed with the option that was chosen. Unfortunately, as a small player on the world stage . . . but we do play on the world stage quite often. As a small player on the world stage, we are dictated to more than we are allowed to talk about policy and what is appropriate. But fortunately, we have had leadership in this country that has often pushed back and stood up for who we are, what we are and wh ere we are and helped put us in a much stronger position. We must continue to do that because while we talk about this legislation today —talk about it as being historic —I look at it as necessity. It is historic, but it is a necessity. If we did not do this , we would be forced to take options that we would not be as comfortable with and perhaps would not go as well for the future of our country. It is no doubt to me, Mr. Speaker . . . and I am not being harsh. I am not being cruel. I am not being derogatory to some of our trading partners and some of our best friends. But there is no doubt to me that each country tries their best to take care of t heir own interests. And I remember there was a speech by a colleague on a motion to a djourn the other night. We had a little chat afterwards about it. He said something along the lines of, Why would our friends do this to us? Well, Mr. Speaker, I have been around for almost 66 years now, and while I love my friends, I realise that if
Bermuda House of Assembly there is a better opportunity for a friend, he might step on your toes. He might try to apologise later but he will step on your toes and rationalise the decision that has been made. So, as a small but mighty a force as Bermuda is, we need to do everything we can to protect what we believe is right. I recall that when my colleague, former Premier Craig Cannonier , went over to the UK as Premier and he was confronted by the media about Bermuda being a tax haven, he pushed back. He denied it. He stood up and he basically said we have the right to set our own tax policy, and then he went right back to where we Bermudi ans can go tell it like it is. And he always will as a person from St. David’s. He says, What do you expect? For us to fish and farm for the rest of our lives?
Hon. E. David Burt: Yes, they do.
Hon. Michael H. Dunkley: I heard the Honourable Deputy Premier say, Yes, they do. You have made my point. You have made my point. We have friends. We have alliances. But at the end of the day, they will take care of their own interests first. And it is up to us to make sure they clearly know what our interests are and what we are going to do to protect them. We will work along with you. But when you start to go the other way, we have to make our decisions. [Inaudible interjection and laughter] Hon. Michael H. Dunkley: Now the Honourable Premier says that he likes my argument for sovereignty. Well, Honourable Premier, I have another speech for that on another day.
[Laughter] Hon. Michael H. Dunkley: And I will dispel this argument as an argument for today’s debate and today’s time. But nice try. I look forward to that debate. I am going to come back to that in a way when I debate another point , because my comments today are on two parts. One, about the Bill. And I commend colleagues who are speaking today and I commend my colleague who spoke before me on our side for laying out in a fair and even manner about the challenges we face, the opportunities we could have but also some of the potential risks that we have. Listening to the Member who spoke just before me, I started to think this might be manna from heaven. Yes, there ar e potential upsides here. But one thing I know, Mr. Speaker, about this world is that just when you think you are on a good wicket . . . and we are on a pretty strong wicket with this. It is much better than the other two options. We have moved with a relatively good pace. It looks like the legislation has laid out the challenges we have to face and put us in a good position, albeit I know that we will have regulations coming quite often in this House. And those will be critically important to get right as well. But I know batting wickets change very quickly. And it is critical to our future well -being that we make sure that we keep that wicket very strong for us to bat on going forward b ecause when we think we have dealt with one challenge, there will be another challenge. And it is interesting because my colleague, the Honourable Member Mr. Pearman, talked about some of those who moved early, some of those who have not moved, and it is noted to me and many other people that some of those who were very strong for this type of legislation are now somewhat reticent to move about it. That tells you a lot . It tells you a lot. Just like the Register of Beneficial Ownership where the UK was telling us all along, You need to do it. You need to do it. [Inaudible interjection]
Hon. Michael H. Dunkley: And our position was . . . And the Honourable Premier said, Still telling us now . And our position 10 years ago when that debate came up was, we had it. We were one of the first to have that register. One of the first to have that register. Remember that. And when you do it, then we can talk about making it not public , but accessible. Not public but accessible. And to this day, we still see them slow to act. But we stuck to what we thought was right and it has proven to be right, an d we are still in a good position. And that is what we need to do with this legislation. While we support what is being done today, I have some caution to the Government. Don’t paint it as all rosy because people will remember your promises. And I know very clearly that life changes very quickly and there are going to be a lot more challenges that we are going to face over the next couple of years, especially because all governments are finding tax revenue hard to come by. All governments are getting more pressure on the ability for that tax revenue to be used for public service. Most of the su perpowers in the world are spending more money outside of their country in conflicts around the world so their budgets are strained. There is going to be a point where every government is going to want more and more and more tax revenue, raising their tax base. But we need to be careful, especially in Bermuda because in a small country like us, the pros and the cons hit you pretty quickly. Now, we are blessed to have international business but generally, in spite of what the Minister of Immigration and L abour and E conomy . . . I have grown to have respect for the Honourable Member in certain areas because he says it like it is and he has a passion for his job. But we disagree with the strength of our economy at the present time because I believe, Mr. Speaker, that our economy is greatly propped up by international business. And many sectors of our economy you still see are weak, and we want t hem to grow. The hotel industry has a lot of blossoms on the trees, but the flowers are not blooming yet. Fairmont Southampton is two years behind the promises the 292 15 December 2023 Official Hansard Report
Bermuda House of Assembly Honourable Premier talked about. But now there is potential there. Our airlift is still weak. The construction industry is weak. Most of the major players in the con-struction industry do not have any work right now and a lot of those shops are not in that business anymore. The only boom in construction right now is the smaller construction firms that are doing residential jobs and fix-me-up jobs and things like that. So while, yes, as a government, you want to talk about the strength of your economy and you want the community to buy into that and have hope for the future, we still are propped up greatly by international business. And long may that remain. But for Mr. and Mrs. Bermuda, we need to see the rest of the economy take some flight and be positive because this high cost of living that we are experiencing is felt mostly by them who lack the disposable in-come. So, when we promise now that with this Bi ll, there will be the potential to reduce the cost of living . . . I love to hear that language. But I would actually like to see it because those promises to people who are strug-gling and hurting . . . they can cut deep. I do not need to get into too much detail about it because I am sure the Honourable Members on that side will appreciate where I am coming from. There is more of a divide in Bermuda between the rich and the poor than there ever was. And I think the Honourable Premier used “ Two Bermudas .” Well, he coined the phrase, but now the Two Bermudas divide is more and more than it ever was. And if we can work through this and get extra tax revenue coming in to lessen that divide to strengthen our community, I will be very happy. But we have a long way to go to make that happen. So, promises made must be kept because we are talking about [people’s] futures. If things are getting better in Bermuda as the Government likes to say, why do we still have many people leaving the country? Maybe things are getting better and they will come back , but I am not seeing it yet. This legislation is landmarked because it will have an impact on Bermuda for years to come and I want that impact to be positive. And thank God that we have international business that we want to protect, Mr. Speaker, and rightly so because I think —I know —that there is still a tremendous upside with international business in Bermuda because one thing that they have shown is that they have the ability not to reinvent themselves but to grow their base by new policies and programmes. And they do it here in Bermuda. They have a footprint here in Bermuda. And so, with legislation like this, international business had to get on board because they knew that the train was coming. They had to make the best of tough decisions that they have, and Government has worked with them and here we are today. When the rubber meets the road and taxes have to be paid and everything is enforced, decisions will continue to be made in the business community, Mr. Speaker. And I do not know what those decisions will be. All I do know is that a lot of these multi -national entities that have operations all over the world will continue to look at the viability of their operations in every jurisdiction and they will make decisions on whether to grow, stay where they are or move in other directions. And these are the t ype of decisions in which we need to do everything possible so that when we come to the end of 2024/25 and the rubber really hits the road, we can give these people an opportunity to say that talent and the ability to be with your regulator and the location that Bermuda has is still numero uno for them. We need to have them overlook the challenges that we have with the high cost of living and some of those other things —sometimes the heightened bureaucracies and the red tape that they have to go through. We need to make sure that the strengths that we have grown from through these years —the strengths that the Honourable Premier and I have talked about around the world at RIMS where people look at you and what you say is the holy grail . . . we need to make sure that our strengths are still there and that they mean more than any weakness that we have. Because one thing I know about this world, information travels quickly. The challenges of Government are going to continue to grow because they have more responsibility than they ever had before. Who would have thought that the world’s greatest superpower, as we sit here to-night on December 15, 2023, is embroiled in two wars and has an open border on their south. Look at the extra money that is costing them. And now they are starting to rationalise, Should we still be supporting Ukraine to the level we are? Should we ask the Israelis to pull back? What do we do about our border ? So they are going to be stressed. They are going to make decisions. And you know they have international business too. That is why they are slow to act. And so, we do . . . as honourable colleagues have said here, we are small; we are nimble. We need to make sure that we stay nimble and we listen to the challenges that we have and we act on them, and we have done this in this case. And so, I am uncomfortable because the future still looks cloudy, but I think we have made a strong first step. Now, Mr. Speaker, the clock is not working so I think I probably have about 25 minutes left.
[Laughter]
The SpeakerThe SpeakerThe time is 6:14. Hon. Michael H. Dunkley: Okay. Good. [Inaudible interjections ] Hon. Michael H. Dunkley: I got it. Mr. Speaker, let me spend a few moments just discussing the conversation around the amendment. I am frankly surprised by the Honourable Premier’s reaction. And when I read the press …
The time is 6:14.
Hon. Michael H. Dunkley: Okay. Good.
[Inaudible interjections ]
Hon. Michael H. Dunkley: I got it. Mr. Speaker, let me spend a few moments just discussing the conversation around the amendment. I am frankly surprised by the Honourable Premier’s reaction. And when I read the press release last night, I
B ermuda House of Assembly said, Okay. That’s politics. The Premier talks about politics, and he seems to be one of the best at mastering the art of politics . He must have had a good teacher. Hon. E. David Burt: I appreciate the compliment. Hon. M ichael H . Dunkley : Yes. But it is a bac khanded one even though he appreciates it. Mr. Speaker, the last I checked, Members of Parliament and Senators have the awesome and difficult responsibility of looking after the interest of this country and the people. And the last I checked, Mr. Speaker, those Members of the Legislature have the right and have the ability to come to this Chamber, stand on their feet and speak and, if they believe it is right, put forward amendments. So, I was quite surprised that the leader of this country, the Premier of Bermuda, would take such great umbrage today in his brief on this (somebody must have been scribbling last night, writing away another six or seven pages to encompass it into it) and criticise my colleagues who he penned as the Three Musketeers . Well, Mr. Speaker, language such as absolute arrogance —I do not know how that applies. Three politicians who care about the interests of Bermuda . . . absolute arrogance. Unchecked arrogance. Well, wait a second. Unchecked arrogance. How can it be unchecked? You put an amendment forward. You vote it down. It is not unchecked. Narrow interest of the OBA. Now, Mr. Speaker, he must have taken some consultation from some of the combined media that they use from time to time. But the last that I checked about th e OBA, we were a broad church. [Laughter] Hon. Michael H. Dunkley: We were a broad church. All you have to do is walk in our caucus and see. We have people from all walks of life in this community. We have people whose opinions can come out and be said no matter what they want to say. And we do not say, You cannot say that in this Chamber. Come on. That is not the case. ( Humph. ) Narrow interest of the OBA. See, that’s the way that the Premier would like to portray us. [Inaudible i nterjections] Hon. Michael H. Dunkley: And you know what , Mr. Speaker, in my time remaining I could go back to Honourable Members. And I’m hitting home because now they are not listening , they are starting to say something . So I am listening very clearly. But I could go back. I could turn it around and I could talk about the narrow interest of the PLP. But I am not going to do that. You know why, Mr. Speaker? Because tonight we are talking about landmark legislation that is critical that we get right. But I will not allow the leader of this country to come into this Chamber and try to belittle my colleagues who are doing things out of the best interest [of Bermuda]. [ Inaudible interjections] Hon. Michael H. Dunkley: And the Premier says, Hold on a second. But I want to say hold on a second, be-cause when I listened to the Honourable Premier, Mr. Speaker, what I heard was that the Honourable Prem-ier did not say that he disagreed with the amendment. But I thought he was close to having a baby, he was getting so excited about it.
An Hon. Member An Hon. MemberA baby? Hon. Derrick V. Burgess, Sr.: Oh, Michael. Hon. Michael H. Dunkley: Well, when you are close to having a baby, you are excited, but you feel pain be-cause the reality of what is going to happen has taken hold. But he never said they disagree with it. [ …
An Hon. Member An Hon. MemberCome on, Mike, you can’t speak to that. Hon. Michael H. Dunkley: No, I cannot speak to having a baby. But my wife had two, and the way she cussed at me, I know she was in pain.
The SpeakerThe SpeakerWe thought you were speaking from experience that time. We were getting a little concerned. Hon. Michael H. Dunkley: Mr. Speaker, I am talking directly to you.
The SpeakerThe SpeakerGo ahead now. [ Inaudible interjections] Hon. Michael H. Dunkley: No, this is serious.
The SpeakerThe SpeakerYes. [ Inaudible interjections] Hon. Michael H. Dunkley: It is deep in my heart. It is deep in my heart. You know, this amendment is not about policy. We are not belittling the people who spent countless hours of their time getting involved. This is not about policy. This is …
Yes. [ Inaudible interjections] Hon. Michael H. Dunkley: It is deep in my heart. It is deep in my heart. You know, this amendment is not about policy. We are not belittling the people who spent countless hours of their time getting involved. This is not about policy. This is about what you can do with the taxes that we . . . and what — [ Inaudible interjection] Hon. Michael H. Dunkley: Honourable Premier, if you could just calm down for one second. 294 15 December 2023 Official Hansard Report
Bermuda House of Assembly It is about what we are going to do with the taxes. And, Mr. Speaker, the last I checked, this House—the House of Assembly —has a fiscal responsibility over the budget of Bermuda. So why isn’t this amendment fair game now? And if the Premier’s rea-son for it is, Well, that can come later. That’s cool. They can vote it down. But why in the mercy do we have to belittle my colleagues —a learned Member such as Scott Pearman. [Inaudible interjections and laughter]
Hon. Michael H. Dunkley: Maybe sometimes honourable colleagues do not like what he says, but one thing I know about Scott Pearman—he cares about his country. And he researches what he says. And he speaks from his heart.
[Inaudible interjections]
Hon. Michael H. Dunkley: No, I do not need to defend him anymore. I will defend anybody. But to see the Premier get so exorcised by it, Mr. Speaker, when all he has to do is say, Yes, we will accept the amendment . We will vote it down. Move on. Right?
[Inaudible interjection]
Hon. Michael H. Dunkley: And that is good. But I take comfort tonight, Honourable Premier . . . Mr. Speaker, through you, I take comfort tonight that they got the message. They got the message, and the best they could do was talk about is politics. Because I can tell you, Mr. Speaker, if I took a poll of all those people who were involved in the consultative process, I am sure they would have laughed at it and said, No, we appreciate the input. We appreciate the input. And I would ask the Honourable Premier when he gets the chance to wrap up: If you are so insulted by the approach of my colleagues who I think did the right thing and I support it 100 per cent . . . if that is the case, then what did the people who were involved in the process suggest should be done to this extra revenue? If it comes, when it comes, what do we do with it? Why don’t we set it up now? Because you know one thing, Mr. Speak er, sometimes when we get in these corridors of responsibility and we have the ability to make the laws that govern our country, sometimes when we get in there, these doors, walls and windows constrain us from really understanding what the people outside are saying. The people outside are losing confidence in the political process because often they think that they only see us when there is an election. So , we need to do more to show them that when there is a complex piece of legislation like this, which they will read in the paper or hear on the news or get it from their social media from somebody hearing a clip in the House . . . They will not get the full story to it. But we need to show them . . . [What] does this corporate income tax thing, you know, do to me? Oh, they are going to tax international business. That has nothing to do with me. But if we tell them, Okay, we are going to get this extra revenue coming in and this is what we are going to do to help you, then they will start to understand and realise that we are working for them. Don’t just make promises, Well, sometime down the road when we have regulations, maybe we will get around to it, or, We will get around to it. What is wrong with putting it in here now so it actually gives them hope that all our words mean more than just words on a Friday in the House of Assembly, Mr. Speaker ? That is not too much to ask for. Because you know what, Mr. Speaker? I would bet dollars to doughnuts — [Inaudible interjection]
Hon. Michael H. Dunkley: I do not bet. That’s why it’s dollars to doughnuts. I would bet dollars to doughnuts that if the shoe was on the other foot, we would see a whole myriad of amendments coming from the other side.
An Hon. Member An Hon. MemberYou can’t say that. Hon. Michael H. Dunkley: And right . . . no problem with that. There is no problem with that whatsoever. I have been in the political process for some time. That is what democracy is all about, Mr. Speaker. And so, if you do not like …
You can’t say that. Hon. Michael H. Dunkley: And right . . . no problem with that. There is no problem with that whatsoever. I have been in the political process for some time. That is what democracy is all about, Mr. Speaker. And so, if you do not like an amendment, do not take it personally. Deal with the fact and let the people decide, Mr. Speaker. Mr. Speaker, I know my time is coming to an end.
The SpeakerThe SpeakerMm-hmm. Hon. Michael H. Dunkley: I made my point on that. And I will just finish by reiterating the fact that while the journey has started, there is a lot more that has to be done. And I am sure we are going to have many more conversations in regard …
Mm-hmm.
Hon. Michael H. Dunkley: I made my point on that. And I will just finish by reiterating the fact that while the journey has started, there is a lot more that has to be done. And I am sure we are going to have many more conversations in regard to this subject as we move forward. And I would like to end by thanking, once again, those colleagues who have worked so hard to make it happen, but your work is not finished yet . Merry Christmas.
The SpeakerThe SpeakerThank you, MP Dunkley. Does anyone else wish to make a contribution at this time? Anyone else? MP Richardson. And it’s getting late. I am going to use a clock just to keep everyone on track now.
The SpeakerThe SpeakerGo ahead. B ermuda House of Assembly Mr. Anthony Richardson: Good evening, Mr. Speaker, my colleagues and to those in the listening audience. Mr. Speaker, today I learned something new. I was not aware of it, but according to MP Scott Pearman, MP Craig Cannonier said to beware if inspiration …
Go ahead.
B ermuda House of Assembly Mr. Anthony Richardson: Good evening, Mr. Speaker, my colleagues and to those in the listening audience. Mr. Speaker, today I learned something new. I was not aware of it, but according to MP Scott Pearman, MP Craig Cannonier said to beware if inspiration is desperation. But I gave some comments some time ago, and it was entitled “They Say .” So, what they say is desperation is your inspiration. [Hon. Derrick V. Burgess, Sr., Deputy Speaker, in the Chair]
Mr. Anthony RichardsonAnd that, Mr. Deputy Speaker, I believe is what characterises the response by MP Scott Pearman tonight as he said on behalf of all of his colleagues that desperation appears to have been his inspiration. Based upon what he has said, based upon his commenta ry, Mr. Deputy Speaker, it …
And that, Mr. Deputy Speaker, I believe is what characterises the response by MP Scott Pearman tonight as he said on behalf of all of his colleagues that desperation appears to have been his inspiration. Based upon what he has said, based upon his commenta ry, Mr. Deputy Speaker, it would appear as though as of tomorrow, if not tonight, the sky is going to fall and there will be no tomorrow. So, Mr. Deputy Speaker, what I will do in the context of— Hon. Michael H. Dunkley: Point of order. POINT OF ORDER [Misleading] Hon. Michael H. Dunkley: I am going to ask the Honourable Member to say the exact words that that Hon-ourable Member might have used. He never said the sky was falling. It was a fair and balanced approach.
Mr. Anthony RichardsonThank you, Mr. Deputy Speaker. If you listen to the delivery of MP Scott Pearman, you would think that the sky is falling and there will be no tomorrow. As I said, desperation appears to have been his inspiration. Mr. Deputy Speaker, the Honourable Michael Dunkley . . . I …
Thank you, Mr. Deputy Speaker. If you listen to the delivery of MP Scott Pearman, you would think that the sky is falling and there will be no tomorrow. As I said, desperation appears to have been his inspiration. Mr. Deputy Speaker, the Honourable Michael Dunkley . . . I think they say . . . like sometimes people try to save. I think that is the right way to put it. Or rescue. And I believe it is fair to say that tonight MP Dunkley attempted a rescue operation, and in my opin-ion his rescue operation has failed miserably, trying to bring it back. Because clearly, the delivery by the ad-mitted spokesperson on behalf of the OBA is that the sky is falling , and that Bermuda almost has no tomorrow. I also find it ironic th at they will commend the civil servants that prepared the legislation, which I believe is genuine, but at some level it is hard to appreciate because they ultimately reject the work that has been presented in the form of this Bill. [Inaudible interjection] Mr. Anthony Richardson: Okay. I will change that to say that in my opinion, it appears as though there is a rejection. And we will see comments that come later on about what work has been done. MP Dunkley also re-ferred to the fact that the collaboration around this is appreciated in that it went out widely to the community. And it is interesting because in this context, he is commending the collaboration but in earlier comments, the action by the Premier to ensure that the OBA were fully advised of some of the information was rejected. So I had a sense in my mind, in my opinion, that I was a little bit confused, to put it mildly. Mr. Deputy Speaker, I am going to . . . obviously, I can only speak once. And it is going to be interesting to see what happens by the end of tonight if any other OBA speaker speaks because thus far, we have had one that says that they do not appreciate it. The other has said that they do appreciate it. So, we will see what else comes from those speakers this evening.
Mr. Scott PearmanSorry. Point of order, Mr. Deputy Speaker. POINT OF ORDER [Misleading]
Mr. Scott PearmanI am afraid the Honourable Member is misleading the House. That is not a correct characterisation of the two speeches given by the Opposition. Thank you.
Mr. Anthony RichardsonMr. Deputy Speaker, I ap-preciate the point of order. But I go back to my opinion is that the Honourable Scott Pearman gave a characterisation as if the sky is falling. MP Dunkley spoke of collaboration, and had some level of appreciation for what has taken place. So, I will …
Mr. Deputy Speaker, I ap-preciate the point of order. But I go back to my opinion is that the Honourable Scott Pearman gave a characterisation as if the sky is falling. MP Dunkley spoke of collaboration, and had some level of appreciation for what has taken place. So, I will carry on from that perspective. Mr. Deputy Speaker, overall, I am always excited to come to the House because what we do has the opportunity to impact every resident in Bermuda be-cause it is . . . and it is easy to sometimes relate what we are doing to the average person, So when we de-bate Bills such as any adjustment to the payroll tax, when we debate B ills that allow for daycare allowances for those who have young children, when we debate Bills such a minimum wage, when we debate B ills that allow for consistent increases to seniors’ pensions, it i s easy to show alignment between what we are doing and the average person. But I will admit that tonight the discussion in terms of the proposed corporate income tax, is not as easy to show how it is going to impact the average per-son in a direct sense. And I say that because even for us in the House, not many of us will work in businesses that will be captured by the corporate income tax. Not many of us in the House are responsible for the returns 296 15 December 2023 Official Hansard Report
Bermuda House of Assembly that will apply. So that is why there is a level of difficulty. I do recognise, of course, though that based upon some of the detail that is going to arise from this, whether it be from a legal perspective or an accounting perspective, that some members, w hich I will say will definitely not be more than five, will have some direct benefit from this legislation. So, what I am going to try to do is speak instead in a way whereby some members of the general public may understand what we are trying to do and my perspective on that. One personal caveat is that I do have, I guess, a professional interest in what we are talking about tonight especially when we come down to things such as the loss carryforwards that are going to apply in this context when we talk about the qualified refu ndable tax credits and when we talk about deferring tax credits. And the reason why I have, I guess, a professional interest is because, just as one of the former speakers [said], it is what we do or have to learn as part of our learning way back when. So, it is going to be interesting to see what comes out of the legislation in terms of how it is going to impact some of these actual firms. And I think MP Scott Pearman referred to this earlier, in terms of loss carryforwards . It is actually quite an interesting thing to see how it is put in place because if Anthony actually has a $1 million loss on year one and then I have smaller income going forward, I am able to use that loss in year one to make sure I have zero tax going forward. So it is, in my mind, an interesting exercise to see how it actually works and how we are going to implement that in Bermuda. But like I said, most of us in the Chamber and actually in Bermuda , are not going to have that sort of involvement . So what I want to do is use an example, or an illustration I believe, as to where the average person may be impacted. And as strange as it is, the analogy I want to use is that a wealthy relative has died. And it is your relative and they have actually died without a will. So, the rules that apply are in place, but you as the recipient are not going to worry about it because you do not really care about it too much. What you really care about ultimately is, Are you are in the will and how much money are yo u going to get ? So, I am using that example because I think that for the average person a lot of this conversation is almost going to be academic until we know how much money Bermuda gets, and that is when it will have an impact on us individually. So, if you go back to the analogy of a wealthy relative dying, and let’s just say you have a family of four—two children and two adults —you can start thinking about, Well, if I get all this money, what am I going to do with it? And I would offer that for the average family, you have to start thinking about the fact that you might get “X” amount of money. What are your priorities? You have to think about things such as . . . you can first of all , do nothing, and just wait until it actually takes place. You c an actually plan that, Okay, I am getting some money. I am going to start doing all these other things. You can plan for it. You can also decide that, I’m getting some more money so I am going to buy a car , for example. You are going to start to spend the money before you actually get it. Or you can decide to go and get a planning person—somebody who understands investments (or whatever) [ who is able ] to assist. So, what the Government has done, and I want everybody to recognise this, they said, You know what? We are going to need some assistance. And that is why the Government has put in place the Tax Reform Com-mission to talk about how the money will be used and also the tax consultative committee to give some advice in terms of what this Bill is about. We need to understand that the Government has been very, very responsible in this context. And so, for the Opposition to try —and I underscore “try” —to criticise what is done is entirely inappropriate in my opinion. So I was surprised that the lead Member w ho spoke, the Honourable Scott Pearman, who said himself he is speaking on behalf of the OBA, would have taken the line that he took because ultimately what has happened is he then, in the inference, is saying that all the work that has been done by all the experts —and others have already commented in terms of the experts including legal people; it included accountants; it included tax specialist and it included businessmen—that their collective wisdom that came to this conclusion is actually to be rejected. Or not to be—
POINT OF ORDER
Mr. Scott PearmanPoint of order, Mr. Deputy Speaker. Perhaps you could correct the speaker. Thank you.
Mr. Anthony RichardsonI take the point that “reject” might be too strong. Maybe it is better to say that it is not the best ultimate advice. Maybe that is a better way to put it. That is not as strong as “rejected. ” Let me try again. [Crosstalk]
Mr. Anthony RichardsonMy point is that the Member’s commentary, as I said earlier, was relatively negative in terms of the legislation. So, I accept that maybe the word “reject” is too strong, so I will leave that alone. But my point is that the Government put together a sig-nificant number of experts …
My point is that the Member’s commentary, as I said earlier, was relatively negative in terms of the legislation. So, I accept that maybe the word “reject” is too strong, so I will leave that alone. But my point is that the Government put together a sig-nificant number of experts to come up with a recommendation, so I am surprised that it has not been accepted in its totality. [Inaudible interjection]
Mr. Anthony RichardsonYes. Sure. Okay. I will move from that point. And just, everybody already knows what my thought is, what my impression Bermuda House of Assembly is based upon the speaker who came first on behalf of the entire OBA. Going back to the family analogy, you have to think about …
Yes. Sure. Okay. I will move from that point. And just, everybody already knows what my thought is, what my impression
Bermuda House of Assembly is based upon the speaker who came first on behalf of the entire OBA. Going back to the family analogy, you have to think about things such as: Do you have a mortgage? Which in the context would be national debt. Do you have school fees? In the context it would be school reform. Renovations would be infrastructure. So, my point is that the Government has actually already demonstrated a significant level of responsibility when it comes to this entire process. So therefore, again, I am surprised at the overall tone. The other point, Mr. Deputy Speaker, would be that the family would have to start to think about potentially saving for either its children or its grandchildren. So from the Government context, that has already been put in place, also, in terms of the Tax Reform Commission is doing just that. It is put in place already to start to think through, irrespective of the amount of money, what should happen with that [and] what is going to be recommended. And as one Member already said, the chairperson, Darren Johnston, is recognised as a very experienced . . . number one, he is a qualified accountant. And I said before, we actually qualified at the same time at PricewaterhouseCoopers way back when, and so I know him quite well in that sense. And he has gone on to have significant experience. And so, I believe it is going to be very, very important for us to, I want to say, at least allow them to come back before we start to critique what it is that they may or may not do. So, in that context, to repeat what the Premier said in the context of [being] the Minister of Finance, was that we truly are at an historical moment whereby I would say that Bermuda of tomorrow is going to be very, very different from Bermuda of yesterday. And so, as we move forward . . . and certainly, if this comes to fruition and we move away from what has been a n historic consumption- based tax, which really, based upon what we buy and labour, is going to make a significant difference in how we move for ward. I have used the example before in terms of . . . so, for me as a professional accountant, I can run a firm and, let’s say, generate $1 million with just two people as opposed to a construction company that would do the exact same thing but would have , say, 10 people. So what would happen is the taxes at the moment, right, are much more unfair to the construction company than they would be to a professional services company. And so right now, in many respects, the tax burden in Bermuda is heavier upon labour than it is upon professional firms. So, going forward, if we are able to get to a stage whereby the tax structure is able to be completely changed, it is going to have a m assive impact on all of us. But clearly, we cannot put the cart before the horse. And I think, to commend the Government, we have not done that. We have done lots and lots of planning instead. The overall comment I want to make is that when we hear what I believe are messages of doom and gloom, they should be put in context because the facts are that there has been significant preparation, planning and consultation. And what I want to do very, very briefly with your permission, Mr. Deputy Speaker, is [mention that] the benefit of these proceedings is that they are sometimes done live and so people are able to pay attention. Thankfully, people are paying attention, and they do send comments someti mes. And just for flavour, if you permit briefly, comments that I have received are that the presentation in some respects was very paternalistic in the sense of, I know better and, therefore, I am going to tell you what to do. I know I am not going to go too far with that because I know you will exercise . . . or express some concerns. But I want to just say once again that the narrative that what is being proposed is actually wrong or might not be the best solution has to be put in the context of professi onal advice.
Mr. Anthony RichardsonUnderstood. Understood. And so I am not — [Inaudible interjections]
Mr. Anthony RichardsonYes, I am not being critical of the process. I am commenting and there may be op-portunity later on to say more things about this. It is the recognition of professional advice that has been received. I will actually end on that because when we get to it . . …
Yes, I am not being critical of the process. I am commenting and there may be op-portunity later on to say more things about this. It is the recognition of professional advice that has been received. I will actually end on that because when we get to it . . . if we get to a stage of commenting directly on the amendment, then I can give more direct comments because it will then be more relevant. I thank you, Mr. Deputy Speaker, for your direction and I will continue to just be mindful of the impression that is given sometimes by comments and how it is received by the general public. Thank you, Mr. Deputy Speaker .
[No audio]
Hon. Jason Hayward: Good evening, Mr. Deputy Speaker . Mr. Deputy Speaker, I think it is clear that we lay out some facts pertaining to the Bill and the process and where we actually are as a jurisdiction. I think we should be abundantly clear that we operate in a global environment with global competition . . . and Bermuda is succeeding in a couple of areas and others simply don’t want Bermuda to continue to succeed. And so we do have a target on our back based off of the success that we have had, whether it is us being market leaders in insurance- linked securities or having a strong market position with captives or being coined the world’s risk 298 15 December 2023 Official Hansard Report
Bermuda House of Assembly capital, being a growing domicile for long- term insurers. Whether it is our ambitions to be a climate risk capital or our ambitions to have a superior technology ecosystem. Bermuda has set a very ambitious vision of where we want to be from a business jurisdiction standpoint. And we have been able to achieve a level of success because we have a value proposition which is underpinned by us being a well -regulated business jurisdiction. Above all things, when [people] mention Bermuda from a business standpoint, is our reputation as a well -regulated business jurisdiction. Whether it be Bermuda from an international tax cooperation standpoint or even a transparency standpoint, we have never skirted away from international responsibilities. We have never skirted away from international collaboration. We have never skirted away from having a juris-diction that is recognised by both Europe and the United States from a regulatory standpoint. We pride ourselves in being a leader in that space. I recall the Premier going to Paris in 2017 to meet with the OECD then to talk about international tax cooperation. We went around the world and we signed tax exchange agreements with a number of jurisdictions. When the global world comes together under-neath the umbrella of the OECD and puts a framework in place which says that all jurisdictions need to come on board as it pertains to corporate income tax, we did not skirt our responsibility to review that matter, determine what was Bermuda’s position and act. Now, some say that Bermuda is moving too quickly, we should wait and see what others are doing. But Bermuda is a leader in a number of spaces and we can be leader on this as well. And we have no problem with moving forward with this legislation because this Government is not fundamentally opposed to corporate taxation. So the world has pushed us in a space where we are already comfortable. What is important when we look at this legislation is that this legislation is not in isolation of the standards that are set out by the OECD. The OECD has Global Anti -Base Erosion [GloBE] Rules that sets out the framework of the basic tenants that your d omestic legislation must have in order for your legislation to be recognised in the global environment. Because, remember, we are saying that there is going to be an international tax so there has to be some level of consistency between what Bermuda is doing and what will be done in other jurisdictions. No, the legislation will not be identical but it has to fall in scope with the basic ten-ets of what is set out by the OECD . I think this is where Bermuda has actually excelled when we look at the legislation that we have been able to bring forth. Cross - checking it with those GloBE Rules and having the OECD review it and vet it to determine whether or not it falls in scope or outside of scope. That is what leaders actually do, and our passing this provides a template for other jurisdictions who may want to move in the exact same direction that we have moved in. And we have seen where they appreciate Bermuda ’s regulatory environment in other areas, such as in digital assets and our digital asset legislation is now being replicated throughout the world. I suspect that Bermuda being a leader in this space, elements of our legislation will also be lifted and duplicated in other [legislatures] around the world. Bermuda is not shooting itself in the foot like some may give the impression in terms of this is a gamble. I don’t like that categorisation. When you are being responsible and a leader, I don’t think you are gambling. I think you have weighed the options, you have looked at the pros and cons and we have made a deliberate and rational decision to move in a cer tain direction. We are not gambling. This has defined outcomes. The extent to which companies remain in Bermuda is not solely contingent on whether or not they have to pay a global minimum tax. There are a multitude of factors. Companies come and go all the time. But that should not force us to shy away from putting a framework in place. This morning we have increased fees for a number of companies. Some companies may not appreciate that fee increase and may make a determination that they are going to leave Bermuda because they do not feel the fees are appealing. But on that piece of legislation there was not one word of the impact of ad-ditional fees and how that may be unattractive to some companies. But when we talk about this legislation, it is this great fear about whether or not companies will leave. Every single time the BMA strengthens our regulatory regime and asks its companies for additional requirements we run the risk of some companies deter-mining that Bermuda is not the environment for them. That is a norm of doing business. That doesn’t mean our entire economy is going to collapse. And so that notion that somehow we are putting something in place that is going to erode the reputation of Bermuda or make Bermuda an unattractive jurisdiction moving forward is far from reality. I have had the opportunity to meet with a number of global business leaders who speak about Bermuda ’s value proposition extending well beyond the zero corporate tax that they were paying from profits. We all know that companies pay tax in Bermuda , so the notion that companies do not pay tax in Bermuda is not accurate. The way in which I would like to look at what we are doing today, Mr. Deputy Speaker, is that again Bermuda is putting itself in a position where we adhere to the GloBE Rules, which is quite clearly laid out in any OECD framework where persons just have to simply follow six steps, which can be complex within themselves. First, we have to determine whether multi -national enterprise groups are within scope or not; look at the income of the entities that fall within scope of that jurisdiction; then we have to find a mechanism to calculate that income; determine whatever adjusted covered taxes there are and then you calculate where topBermuda House of Assembly up taxes may [be] needed based off of differentiations with other jurisdictions. But that speaks to a technical framework that is built within our legislation. The legislation sets out in a clear manner how we will follow the framework which is set out by the GloBE Rules. What is not in the GloBE Rules is what to do with the revenue that may be received and that is the amendments that are seeking to be made that will be discussed later, but that is not in the global frame-work. When the Premier says there is an opportunity for us to talk about how we operate in a fiscally respon-sible way, there is certainly an opportunity. But if we have had a piece of legislation that follows a framework, has been vetted by the persons who put that framework in place, then let’s proceed with the first step and that is getting the legislation finalised first. See, it is this thing that the Premier says about let’s not spend the money before we get it . Let us not earmark stuff that we don’t even know we have. Again, we are going to have another measured discussion in terms of our overall tax system, how we will appropri-ately handle revenues moving forward and whatever adjustments that need to be made w ith our domestic taxation system to complement those revenues that we get. We all know that we must be fiscally responsible and prudent. We already have fiscal guardrails in place in terms of how spending is done. We already have processes in place, built within Parliament, as to how budgets are approved. I don’t see the urgency of inserting those recommendations or amendments in at this point. But I would like to hear (not being controversial at all) whether or not the insertion of those amendments were raised with the tax group who were working on this legislation and what was their opinions of inserting those in. Because if you work on a team and the consensus of the team was that we are satisfied with this and we are not handling that portion, then why try to utilise a different mechanism to move forward amendments if you were part of a group that was responsible for the ultimate drafting of the legislation. So I am interested in terms of the process and whether or not that was actually raised in the meetings with the tax group to determine whether or not that will fal l in scop e or outside of scope of the exercise that they were doing. I spoke about Bermuda’s value proposition but before we go there, we can touch on why global mini-mum tax is important in the first place. It basically eliminates companies from dodging taxation from arbitrage and profit shifting. We know that [companies] have uti-lised jurisdic tions to reduce their ability to pay income tax in other jurisdictions. And governmen ts lose from companies actually doing that. This will increase the revenues of governments (not just in Bermuda) but any government who is dealing wi th companies who are multi -national companies that have income over [€750] million of revenue . . . but it is important to know why this is a global challenge as it pertains to governments wanting to ensure that the companies pay their fair share of tax. You see, as a worker my payroll tax comes directly out of my cheque. I can’t dodge it if I wanted to. The workers of a country pay their fair share and gov-ernments are asking the corporations who operate within territories to pay their fair share as well. And that fair share will go towards increased social programmes, increased infrastructure, paying down debt. Before this tax revenue . . . we are talking about what that fair share means to societies. And as a trade union we have always grappled with corp orations placing profit over people and them not paying their fair share. We have always advocated for tax justice and we have always advocated for corporations to pay their fair share. This legislation falls directly in the ethos of what the Labour Party represents and we start to talk about economic and social justice . . . and I am proud to be attached with the movement that we are making in this space. As a trade unionist, I will say this doesn’t go far enough because there are a slew of domestic companies that have profited off of the labour in this country for years and have not paid their fair share of taxes. But this is an adequate first step. Mr. Deputy Speaker, I want to close with a bit about Bermuda ’s value proposition. Bermuda offers more than just tax incentives, that is made abundantly clear. We have regulatory efficiency. We have regulatory clarity. We have legal clarity. We have political stability. We have economic stability. We have human capital. We have the professional services that companies need to support their operations so they can thrive. We have a high quality of life. We have a low crime rate. These are all the things that companies look [at] when selecting a jurisdiction. And those are the things that companies would have to consider when they are moving to other jurisdictions, if they choose to. Whether or not the business value proposition of that other jurisdiction trumps that of Bermuda. I will say this: you won’t find many jurisdictions that tick the boxes that Bermuda ticks from a regulatory standpoint, from a legal standpoint, from a political sta-bility standpoint, from an economic stability standpoint, from a quality of life standpoint, from a sophistication standpoint . . . their ability to get human capital in an efficient way. Bermuda is paradise. For over 70 years we have been a leading business jurisdiction and we continue to grow. Our reputation around the world con-tinues to grow . And I meet companies by the day that have an interest in domiciling in Bermuda . Notwithstanding the fact that they are clear that we are implementing a framework for global minimum tax in Bermuda. I have met with companies who have doubled down on their commitment to Bermuda, who tell me that this tax does not matter to them because they see the value of Bermuda. They see the value of operating in a sophisticated business environment where their peers 300 15 December 2023 Official Hansard Report
Bermuda House of Assembly operate in. Mr. Deputy Speaker, I want to make it abundantly clear [that] the economic development strategy that we set out, part of it is ensuring that we have a business environment that allows companies to thrive so that we have the ecosystem that transcends any tax changes that we are actually making. But we also seek to diversify our economy as well and have robust economic activity in multiple industrial sections so that we are not so reliant on a shock of if a company determines that it wants to leav e. But even when we discuss that, we have to talk about the companies which are within scope and outside of scope and many of the companies (international businesses) that are in Bermuda are outside of scope. So, no, we haven’t quantified the impact of what if some companies determine that Bermuda is not a jurisdiction for them. But like I said, we have a fluctuating business register. Companies come and go all the time for different reasons. And while those companies may have come and gone over the years, Bermuda ’s reputation has remained intact, and we are still appealing to new capital. Bermuda is one of the best places to get your capital to market in an efficient manner. Bermuda remains the best place to set up a new insurance com-pany. [If] you want to set up a new company in [the] United States, you have to deal with three, four different regulators. And you have multiple laws to interpret dif-ferent rules of each of those regulators. You come to Bermuda, you link up with Conyers. Conyers walks you to the BMA, you sit down, you have a meeting. They let you know what framework you need to put in place. You have a courtesy meeting with the Minister of Economy and Labour and say I just met with the BMA and all seems to go well, they put some requirements to us, we are going back to talk to our team. They did tell us that we have to have more compliance functions and I commit to have my colleague to have my board meetings here. And boom. Wham, bam, thank you ma’am, we have a new company formed within a couple of meets. [Inaudible interjections] Hon. Jason Hayward: Conyers. Conyers does well. They have a role to play in our local business environ-ment. [Inaudible interjections] Hon. Jason Hayward: Yes, they have a role to play in our local business environment. I just want to say, not-withstanding that, our entire ecosystem is interconnected. Mr. Deputy Speaker, with those words, I will say I am pleased that this Bill has been brought today. I am pleased to see that the framework is in alignment with the global framework. We didn’t go out there on
1 Royal Gazette , 17 March 2015 our own and invent something. It fits within the frame-work that has been in place. We are world leaders as it pertains to this. And last but not least, Bermuda remains the number one business jurisdiction in the world. Thank you. [Desk thumping] [No audio]
Mr. Christopher FamousMr. Deputy Speaker, if you will allow me, I would like to read something from your favourite newspaper from 2015. [Inaudible interjections]
Mr. Christopher FamousYou were close, pretty close. Pretty close. 1“International CEO states the case for corporate tax. John Charman: Corporate tax in Bermuda is inevitable.” March 17, 2015. “A top insurance [ industry ] boss believes that a tax on company profits is inevita-ble—” and goes on to say, “and would be …
You were close, pretty close. Pretty close.
1“International CEO states the case for corporate tax. John Charman: Corporate tax in Bermuda is inevitable.” March 17, 2015. “A top insurance [ industry ] boss believes that a tax on company profits is inevita-ble—” and goes on to say, “and would be in the longterm interests of the Island’s people and its economy. ” Suffice it to say, Mr. Deputy Speaker, these are the sort of folks that, as you say, run corporate Bermuda . In 2015, he predicted that we would be right here today. Just to qualify, he was the chairman and chief executive of Bermuda- based Endurance Specialty Holdings Ltd. I don’t know if he was one of Conyers’ clients, but . . . Mr. Deputy Speaker —
Mr. Christopher FamousOkay. Mr. Deputy Speaker, I was in St. Lucia in 2019 at a conference and the topic of global tax came up. I am using this as a timeline. And one of Bermuda’s chief competitors was highly upset when global tax . . . when it seemed that global tax …
Okay. Mr. Deputy Speaker, I was in St. Lucia in 2019 at a conference and the topic of global tax came up. I am using this as a timeline. And one of Bermuda’s chief competitors was highly upset when global tax . . . when it seemed that global tax was going to be inevitable. That place wanted other islands to fight against global tax because this would now put everybody else on the same footing as them —or put them on the same footing as everybody else. You see, Mr. Deputy Speaker, we have to fight against misinformation. One misinformation that has been put out there as of late was that the PLP has just
Bermuda House of Assembly got up on its own . . . David Burt on his own has decided to implement corporate tax and this is going to destroy our economy. This will cause people to get on flights. Basically fearmongering, Mr. Deputy Speaker . So it is important to put historical context. When business leaders have said that (in 2015) that corporate tax was inevitable, when in 2019, on a regional scale, it was sharing that corporate tax was inevitable, why is it now suddenly the PLP is the bad guys? Mr. Deputy Speaker, I have learned something about the OBA as of late. They know they don’t have the numbers to debate us in the House, as we can see tonight out of six of them, only two have spoken thus far. However, what they do do— [Laughter]
Mr. Christopher Famous—is put stuff out in the media, whether directly themselves or through their supporters. And they stir up this fearmongering. Oh, there has been no consultation. Well, that is false because the former Premier just said he is complimenting the OBA for consultation. Oh, this will scare companies away . …
—is put stuff out in the media, whether directly themselves or through their supporters. And they stir up this fearmongering. Oh, there has been no consultation. Well, that is false because the former Premier just said he is complimenting the OBA for consultation. Oh, this will scare companies away . Well, that is false because international business has asked for this. Oh, we are creating another IRS . That is false because this is what has to happen. You see, Mr. Deputy Speaker, it is one thing to come in the House and say we agree and we are glad [for] this . . . but then the OBA does nothing to dispel all the fearmongering. The same things they will say in this House, they will not get into public, in the media, and say. They w ould never compliment the PLP for doing what we did in the media. Why is that? But, you know what, Mr. Deputy Speaker ? They also acknowledged we had no choice and this is what we have done. So, Mr. Deputy Speaker, I will not be long.
Mr. Christopher FamousAll I would say is that for whoever is the Government , whether it is us or in 20 years’ time when the OBA wins an election, we have to manage the expectations of what comes out of this cor-porate income tax. Maybe we make a billion [dollars] a year; …
All I would say is that for whoever is the Government , whether it is us or in 20 years’ time when the OBA wins an election, we have to manage the expectations of what comes out of this cor-porate income tax. Maybe we make a billion [dollars] a year; maybe we make $300 million a year. But the money must be used for infrastructure, yes, just like we use our money now. And the money must be used to pay down our debt, just like we use our money now. I do not know why the OBA thought they were going to come with some amendment to do what we are doing anyway. You see, Mr. Deputy Speaker, I will close here by saying thank you to the team over there —I see Ms. [Cheryl -Ann]Lister] . I see Mr. Anderson, and others who are not here. Thank you for all the hard work that you all have done to put us on this footing. I received a text earlier today from one of the regional economists, Marla Dukharan, who praised us for taking this step to say that inevitably others will do it. Mr. Deputy Speaker, I fully support this Bill and I look forward to seeing it in fruition in 2026. Thank you, Mr. Deputy Speaker .
The Deputy SpeakerDeputy SpeakerThank you, Honourable Member MP Famous. Any further speakers? The Chair recognises the Honourable Deputy Premier, Walter Roban. You have the floor, sir. Hon. Walter H. Roban: Thank you, Mr. Deputy Speaker . It has been an interesting evening around the discussion of this corporate income tax Bill—
The Deputy SpeakerDeputy SpeakerMm-hmm. Hon. Walter H. Roban: —and certainly many of my colleagues have covered some very good ground and have said much of what has had to be said. And that is always appreciated because it means the rest of us don’t have to say too much.
The Deputy SpeakerDeputy SpeakerThank you. [Laughter] Hon. Walter H. Roban: But I will say a few words, Mr. Deputy Speaker .
The Deputy SpeakerDeputy SpeakerMm-hmm. Hon. Walter H. Roban: Firstly, let’s put some historical perspective on this, Mr. Deputy Speaker . The Progressive Labour Party has always . . . and I say always had a clear purpose around tax from the very beginning. And in some cases . . . well, actually, we …
Mm-hmm.
Hon. Walter H. Roban: Firstly, let’s put some historical perspective on this, Mr. Deputy Speaker . The Progressive Labour Party has always . . . and I say always had a clear purpose around tax from the very beginning. And in some cases . . . well, actually, we have always been an outlier when it comes to tax in Bermuda.
The Deputy SpeakerDeputy SpeakerMm-hmm. Hon. Walter H. Roban: At the very beginning in 1963, and if you will allow me just to read a few lines —
The Deputy SpeakerDeputy SpeakerContinue. Hon. Walter H. Roban: —Mr. Deputy Speaker, it brings clarity to the purpose upon which we are fulfilling today when it comes to the Progressive Labour Party and our ideology and philosophy and the consistency of it. It says this, in the 1963 platform, An investigation of sources of …
Continue.
Hon. Walter H. Roban: —Mr. Deputy Speaker, it brings clarity to the purpose upon which we are fulfilling today when it comes to the Progressive Labour Party and our ideology and philosophy and the consistency of it. It says this, in the 1963 platform, An investigation of sources of revenue with the view to more equitable distribution of the tax burden. An investigation on the advisability of introducing some form of direct taxation. 302 15 December 2023 Official Hansard Report
Bermuda House of Assembly So as you can see, Mr. Deputy Speaker, it is very clear that as the Honourable Member who took his seat earlier, the Honourable Member Minister Hayward, said about tax justice.
The Deputy SpeakerDeputy SpeakerMm-hmm. Hon. Walter H. Roban: This has been something that the Progressive Labour Party has always had an eye on for our country because of the historical inequities economically, the historical inequities in labour prac-tices and the historical social inequities in where wealth was di stributed and placed. This has …
Mm-hmm.
Hon. Walter H. Roban: This has been something that the Progressive Labour Party has always had an eye on for our country because of the historical inequities economically, the historical inequities in labour prac-tices and the historical social inequities in where wealth was di stributed and placed. This has been the purpose that we felt was important in governance for the country when others did not. And in fact as you would know, Mr. Deputy Speaker, the PLP was historically chastised for its position around tax—
The Deputy SpeakerDeputy SpeakerYes. Hon. Walter H. Roban: —to the point where we had at some point had to say we will not introduce income tax. That was something that followed consistently in PLP statements as to lower the fear that the issue of tax had been imposed on this country. And let’s …
Yes.
Hon. Walter H. Roban: —to the point where we had at some point had to say we will not introduce income tax. That was something that followed consistently in PLP statements as to lower the fear that the issue of tax had been imposed on this country. And let’s be real. There was a period of time of our history where we seemed to benefit from being portrayed as a tax haven, for a pe-riod of time. But as we know, time has changed. Those who may have benefited from Bermuda being a place where they could go and tuck their money away from the larger tax regulation agencies, now the GloBE is looking for harmonisation and transparency around corporate practices. Things like beneficial ownership . . . people want to know what is going on. It is no longer permitted for large multi -national [corporations] who now seemingly are being chased all over the world for how they manage their affairs and finances. I just read an article about how in the European Union that ironically Amazon won a case around paying taxes. So they are constantly, these large multi -national [corporations], are constantly being pursued around their tax practices.
The Deputy SpeakerDeputy SpeakerYes. Hon. Walter H. Roban: That is now what’s happening, that wasn’t maybe decades ago. But the reality is now transparency around your corporate practices, your profits, are what is demanded internationally. Thankfully, and this is perhaps the part that has finally helped the PLP’s position in this now is …
Yes.
Hon. Walter H. Roban: That is now what’s happening, that wasn’t maybe decades ago. But the reality is now transparency around your corporate practices, your profits, are what is demanded internationally. Thankfully, and this is perhaps the part that has finally helped the PLP’s position in this now is that this demand for transparency has itself been of benefit to Bermuda because many years ago, Mr. Deputy Speaker, and you would appreciate this, we decided as a jurisdiction to pursue good regulatory practices as others —some of these are competitors —ran away from it. We sought to cooperate with larger groups like the OECD and the EU and others around having transparent, good regulatory frameworks. The Deputy Speaker: Yes.
Hon. Walter H. Roban: What can be said now, Mr. Deputy Speaker, is that . . . and I know that some people might say Well, there is some risk in the short -term with the steps that we are taking and that we seem to be taking this step before others are taking it, as if somehow we should wait and see. But what I think is important, Mr. Deputy Speaker, is that time has proven the Bermuda formula to be right in that this effort and reputation of Bermuda as a good . . . well- regulated jurisdiction that has transparent and good practices has over time benefited us —
The Deputy SpeakerDeputy SpeakerYes. Hon. Walter H. Roban: —as the Honourable Member Minister Hayward said. Our value proposition to companies that are here now is wider than the issue of just paying a differ-ent form of taxation . . . I will call it that because it is not that people, like he …
The Deputy SpeakerDeputy SpeakerYes. Hon. Walter H. Roban: They pay different taxes than what is paid in other jurisdictions. And I might add, even places like the United States and others who maybe haven’t signed on to this particular movement around the global minimum tax, they have had corporate income tax for years. …
Yes. Hon. Walter H. Roban: They pay different taxes than what is paid in other jurisdictions. And I might add, even places like the United States and others who maybe haven’t signed on to this particular movement around the global minimum tax, they have had corporate income tax for years. Income tax has existed in the US since the early 20 th century.
The Deputy SpeakerDeputy SpeakerYes. Hon. Walter H. Roban: And corporate taxes have existed in most developed jurisdictions for quite some time. So corporate income taxes are a uniform existence in many countries already. It is not something alien in existence. But here we are and we have proven over time to be the …
Yes. Hon. Walter H. Roban: And corporate taxes have existed in most developed jurisdictions for quite some time. So corporate income taxes are a uniform existence in many countries already. It is not something alien in existence. But here we are and we have proven over time to be the beneficiary of good regulatory practices, transparent, well -run business environment and a good framework that companies can rely on for certainty. That is proven over time even if there were bumps in the road to be the best approach. So like the Caymans, the BVIs and others who have a different perspective on these things than we have, they have other issues and maybe they are not warmed to taking this step as we are.
The Deputy SpeakerDeputy SpeakerYes, yes. Hon. Walter H. Roban: But the reality is that Bermuda has decided to take an approach that will be best for Bermuda. I just want to touch on this issue, it came up earlier ironically, the Premier sort of put it out there and Bermuda House of Assembly …
Yes, yes.
Hon. Walter H. Roban: But the reality is that Bermuda has decided to take an approach that will be best for Bermuda. I just want to touch on this issue, it came up earlier ironically, the Premier sort of put it out there and
Bermuda House of Assembly Mr. Dunkley sort of made a comment to it. This issue of sovereignty. But I am not going to touch on sovereignty in the way you think.
The Deputy SpeakerDeputy SpeakerOkay. Hon. Walter H. Roban: Sovereignty is about taking the best approach to your interests. It means having a tax policy that works for you. It means having an economic policy that works for you. It means having a regulatory framework and a system of governance that works for you, …
Okay.
Hon. Walter H. Roban: Sovereignty is about taking the best approach to your interests. It means having a tax policy that works for you. It means having an economic policy that works for you. It means having a regulatory framework and a system of governance that works for you, that works in your interests even as others may have their own interests. It means our approach to beneficial ownership that is in our interest and exerting ourselves around that and other issues around anti -money laundering and anti -terrorist financing and having an approach that is world standard and exerting ourselves in this space. That is us exercising our sovereignty in our interests. There are other issues of sovereignty which may come up at a later time, but that is also being sovereign as well. It is us doing what is necessary to protect our interests and to best represent what Bermuda thinks is the best approach for our affairs.
The Deputy SpeakerDeputy SpeakerMm-hmm. Hon. Walter H. Roban: That is what we have done here and we have taken an approach with this which has been collaborative, which has been deliberate and purposeful. The irony, as has been already stated, is this has been done in full cooperation with the corporate community. But …
Mm-hmm. Hon. Walter H. Roban: That is what we have done here and we have taken an approach with this which has been collaborative, which has been deliberate and purposeful. The irony, as has been already stated, is this has been done in full cooperation with the corporate community. But that has been our history wi th most of what we have been doing in the space of the insurance industry, the financial services industry, even in the tourism industry. It is consulting and working with the stakeholders to figure out the best approach in a collaborative way, with our union partners, with our corporate partners, with our industry partners. Even as there is tension, taking that approach for Bermuda has been a hallmark of how things operate here and it has turned out to be by and large very work-able. I believe with this situation we have done the same thing. Essentially what this Bill represents is ex-actly what our corporate partners feel is best bec ause they have already come to the realisation that this is the best thing that Bermuda can do. As the Honourable Member Jason Hayward says, the value proposition for Bermuda and them is that Bermuda to them represents more than just a place where they come to make money. It is actually a good jurisdiction for all the reasons that the Honourable Minister stated (and I don’t have to repeat).
The Deputy SpeakerDeputy SpeakerMm-hmm. Hon. Walter H. Roban: Supporting Bermuda in coming to terms with this issue, which is an international issue and ensuring that Bermuda has the best framework that allows them to be healthy in their operations here is the best way to go.
The Deputy SpeakerDeputy SpeakerMm-hmm. Hon. Walter H. Roban: And they have done that. So they have helped and worked with the Government to put together this legislation, the International Tax [Working] Group, which worked on it. And then of course there is now the Tax Commission that is going to deal with other …
Mm-hmm.
Hon. Walter H. Roban: And they have done that. So they have helped and worked with the Government to put together this legislation, the International Tax [Working] Group, which worked on it. And then of course there is now the Tax Commission that is going to deal with other matters. I do believe that one of the points of why the amendment that has been proposed by the Opposition is of concern because it appears —and I just say appear—
The Deputy SpeakerDeputy SpeakerMm-hmm. Hon. Walter H. Roban: —Mr. Deputy Speaker , not to make an accusation.
The Deputy SpeakerDeputy SpeakerYes. Hon. Walter H. Roban: It appears to be bypassing this process that was created for us to deal with this matter. That is the appearance. Now those who are supporting that amendment, perhaps they will get an opportunity to make rep-resentations around their proposed amendment. But the appearance is …
Yes.
Hon. Walter H. Roban: It appears to be bypassing this process that was created for us to deal with this matter. That is the appearance. Now those who are supporting that amendment, perhaps they will get an opportunity to make rep-resentations around their proposed amendment. But the appearance is that they are bypassing the very framework that was put in place of which they are a member of . You and I know, Mr. Deputy Speaker, if this was an example of a collective bargaining agreement and if some party to the collective bargain had gone around the process that allows for certain matters to be dealt with that as a party of that collective bargaining agreement you and others would be up in arms that somebody went around that to get to a result that the collective bargaining agreement prescribes to get to a certain journey. That, I believe, is the core issue here around this is that potentially they have bypassed a process that they are a part of to bring something to this House that doesn’t seem to correspond within the framework that was created for us to deal with this mat ter—and of which the Honourable Premier has said we still have some road to go. This Bill is just the first component of a new tax system that we are working (with our partners) to organise for the country. In good spirit and in good intention, we should all be prepared to follow the framework because that is what brings greatest comfort and the most appropriate behaviour of everybody who is involved. We all understand what we are doing here and it is import ant to the history and the future of the country that this process be done in the way that everybody who is a party to it, is going to be impacted by it, actually feels we have done this the right way. 304 15 December 2023 Official Hansard Report
Bermuda House of Assembly I myself am quite happy that this Bill has finally been brought because I do believe it does bring much vindication to the position that the Progressive Labour Party itself has had over many years around tax. That Bermuda required a more equitable and fair tax system where all parties were paying their fair share. How shall we ultimately deal with whatever are the proceeds of this new system? Well, I guess we will figure that out together.
The Deputy SpeakerDeputy SpeakerMm-hmm. Hon. Walter H. Roban: I think that this is a process that despite how laborious or perhaps how long it will take, Mr. Deputy Speaker, that will be worth it because it stands to have impacts long into the future for our country in ways that I believe, certainly …
Mm-hmm.
Hon. Walter H. Roban: I think that this is a process that despite how laborious or perhaps how long it will take, Mr. Deputy Speaker, that will be worth it because it stands to have impacts long into the future for our country in ways that I believe, certainly from an ideo-logical and philosophical point, is good and will be good for all our residents, good for all of our people and allows the country to address major issues that we have long felt could be addressed by a different type of tax system. The tax system we have now, as you would know, has fundamentally existed with a few modifica-tions since the 1600s, based on the collection of duties and of course there is land tax and payroll tax of which would have also been added on. But fundamentally most of the taxes are collected the same way as they have been since the beginning of settlement.
The Deputy SpeakerDeputy SpeakerHmmm. Hon. Walter H. Roban: And that doesn’t necessarily fit the modern world that we are in now. We know that the system of taxation that we have certainly for payroll tax has implications for labour and for workers and it es-sentially puts a burden on workers and also makes …
Hmmm.
Hon. Walter H. Roban: And that doesn’t necessarily fit the modern world that we are in now. We know that the system of taxation that we have certainly for payroll tax has implications for labour and for workers and it es-sentially puts a burden on workers and also makes the cost of labour more expensive. Now if there is an opportunity with the new tax system to make changes to that which can make our labour more competitive and create better opportunities for workers in this country irrespective of what area they work in, that is a good thing, if that can be a byproduct of this new system that we are contemplating and putting together. Again, this is the opportunity, yes, for us to perhaps and once again as a leader, as a country that has confidence in how we operate, we are showing others in the world of how something can be done that may be a very difficult decision. I do note that my honourable colleague who sits for constituency 11 mentioned one of the regional economists who I know, Ms. Marla Dukharan. [She] is a great champion for tax justice in the region, who has been very critical of how jurisdictions like Bermuda and others in the region have been treated by the supernational bodies like the OECD and the EU and others on attempting what appears to be to attack our system of business and economics because some of our jurisdictions rely on financial services and other businesses that somehow the constant goalposts that we are subjected to is unfair. This global minimum tax is an opportunity for us to exercise a little bit more sovereignty on our affairs as a jurisdiction and as a region. Which is why I am sure Ms. Dukharan is in support of it, because it brings some justice to a system which seems to constantly be tilted to benefit larger jurisdictions and larger companies and smaller jurisdictions like Bermuda and others, island jurisdictions, need to have a more fair or stronger position in the wider global economic picture. I believe this is a piece that will help to bring that to Bermuda. Bermuda as has already been stated has a good reputation and we are moving forth in this process with a confidence that what we are doing will not only work for us but perhaps others might see it and decide it can be done in a way that helps us too. I look forward to the journey. I believe this is in keeping again with the philosophical underpinnings of my party, this Government to pursue tax justice, to create a fairer, more equitable tax system for our country and creates a potential for an even brighter future. I am not going to predict what we can do or how we can do it with whatever happens from this. I am not going to do that. I look forward to the journey with figuring it out with everybody.
The Deputy SpeakerDeputy SpeakerThank you. Thank you. Hon. Walter H. Roban: I wish to thank you, Mr. Deputy Speaker, for the opportunity to speak on this and I look forward to the rest of the debate. Thank you.
The Deputy SpeakerDeputy SpeakerThank you. Thank you, Deputy Premier. Any further speakers? Minister Rabain. Hon. Diallo V. S. Rabain: Thank you, Mr. Deputy Speaker . Mr. Deputy Speaker, it is . . . I know we get tired of hearing this when you say, Oh I wasn’t expect-ing to speak , but—
The Deputy SpeakerDeputy SpeakerYes, we do. Hon. Diallo V. S. Rabain: —you get motivated when we are talking about legislation like this. It is landmark legislation. There isn’t a lot more that can be said here. It is really one of those things that you think everyone is on the same page and …
Yes, we do.
Hon. Diallo V. S. Rabain: —you get motivated when we are talking about legislation like this. It is landmark legislation. There isn’t a lot more that can be said here. It is really one of those things that you think everyone is on the same page and then you come and you get surprises. I know earlier, and the Hansard will validate this, that Learned Member MP Pearman (on the other side) did say that this was not released until this morning, to the press.
The Deputy SpeakerDeputy SpeakerWell, that was cleared up. Bermuda House of Assembly Hon. Diallo V. S. Rabain: And so —
The Deputy SpeakerDeputy SpeakerYou don’t have to go over it again. Hon. Diallo V. S. Rabain: Well, bear with me, Mr. Deputy Speaker —
The Deputy SpeakerDeputy SpeakerYes, but we don’t want to be repetitious up here. [Laughter] Hon. Diallo V. S. Rabain: What we do . . . what we do want . . . what I do want to spell out, Mr. Deputy Speaker, is we have seen this story before. You have been around …
Yes, but we don’t want to be repetitious up here. [Laughter] Hon. Diallo V. S. Rabain: What we do . . . what we do want . . . what I do want to spell out, Mr. Deputy Speaker, is we have seen this story before. You have been around long enough to know that the UBP hand-book that some of our Members Opposite, they literally grew up with it next to their crib. As they grew up, they heard it over and over and . . . you cannot even really blame them for the comments that they make because it is so engrained within them. It is engrained within them to automatically make statements that bring into doubt the fact . . . they bring into down that persons that look like me and you just simply cannot manage money. Can’t run the country. The Deputy Speaker: Mm-hmm.
Hon. Diallo V. S. Rabain: And it has become so subtle and so engrained in the language that they speak and it just becomes disappointing to hear it in 2023 when the Bermuda public clearly rejected that notion in 1998 and continues to reject that notion, but it seems like we are having a resurgence of that type of statement coming from the other side— especially from the Shadow Minister of Finance that does sit in another plac e, Mr. Deputy Speaker .
The Deputy SpeakerDeputy SpeakerHmmm. Hon. Diallo V. S. Rabain: And it is actually tiring to listen to his inuendo statements that he makes on a reg-ular basis, whether it be in social media comments to the media and the like. And it is really frustrating to hear because we have been there, we …
Hmmm. Hon. Diallo V. S. Rabain: And it is actually tiring to listen to his inuendo statements that he makes on a reg-ular basis, whether it be in social media comments to the media and the like. And it is really frustrating to hear because we have been there, we know, to hear what he is saying without saying it as, These guys can’t do it.
The Deputy SpeakerDeputy SpeakerYes. Hon. Diallo V. S. Rabain: You give them this . . . you . . . They put this in place and there is a whole bunch of money. Watch what is going to happen. Not anything for you. But, Mr. Deputy Speaker, we have said (and it has …
Yes. Hon. Diallo V. S. Rabain: You give them this . . . you . . . They put this in place and there is a whole bunch of money. Watch what is going to happen. Not anything for you. But, Mr. Deputy Speaker, we have said (and it has been said over and over and over) that this . . . if there is the windfall (their words) that the main purpose
2 Royal Gazette , 1 November 2023 of this is to lower the cost of living for Mr. and Mrs. Ber-muda in this Island. How does taking this and putting in place a mandatory you have to pay down the debt, you have to replace the infrastructure make the cost of liv-ing lower for Mr. and Mrs. Bermuda . . . how does that equate right off the bat? Any responsible g overnment makes decisions in the best interests of its citizens. What we have from the other side, Mr. Deputy Speaker, is trying their very best to get people to forget that this Government carried this Island through a once- in-a-lifetime pandemic. Imagine, Mr. Deputy Speaker, if we said we are not going to assist you because you have to stay home. We are going to pave roads instead.
The Deputy SpeakerDeputy SpeakerMm-hmm. Hon. Diallo V. S. Rabain: Imagine if persons were home hungry unable to buy food, unable to pay rent, unable to live, but they could ride on smooth roads. So those are the decisions. They are not good . . . they are not great decisions because you now …
Mm-hmm. Hon. Diallo V. S. Rabain: Imagine if persons were home hungry unable to buy food, unable to pay rent, unable to live, but they could ride on smooth roads. So those are the decisions. They are not good . . . they are not great decisions because you now end up with . . . you now have to deal with the type of stuff that we have. So, Mr. Deputy Speaker, we have the Member that sits in the other place. He sits on the Tax Reform Commission whose sole remit (as you have heard over and over) is to come up with ideas on how we move forward and reform our tax base. The Opposition is try-ing to say, T his is not a political stunt, this is what we should do because it is the right thing to do. But, Mr. Deputy Speaker, I harken back to November 1—
The Deputy SpeakerDeputy SpeakerMm-hmm. Hon. Diallo V. S. Rabain: And if you will allow me —
The Deputy SpeakerDeputy SpeakerYes. Hon. Diallo V. S. Rabain: 2November 1 an op- ed by the Member that sits in the other place and he said, “Importantly, how will the Government manage its finances and budget,” (Aah, there are those trick words again.) " when the amount of tax revenue can vary greatly …
Yes.
Hon. Diallo V. S. Rabain: 2November 1 an op- ed by the Member that sits in the other place and he said, “Importantly, how will the Government manage its finances and budget,” (Aah, there are those trick words again.) " when the amount of tax revenue can vary greatly from year to year? What will we [have] if we are lucky enough to have a tax windfall?” Miraculously we are hearing these same words a month and a half later as if they just came up with it.
The Deputy SpeakerDeputy SpeakerHmmm. Hon. Diallo V. S. Rabain: “Will the sinking fund be resurrected rather than emptied? Will we create a sover-eign fund like Ireland has [done] with its recent strong tax revenues? Perhaps we should create laws about how much debt the Government must pay [ down] with each budget.” Why …
Hmmm. Hon. Diallo V. S. Rabain: “Will the sinking fund be resurrected rather than emptied? Will we create a sover-eign fund like Ireland has [done] with its recent strong tax revenues? Perhaps we should create laws about how much debt the Government must pay [ down] with each budget.” Why does that sound familiar? Novem-ber 1.
306 15 December 2023 Official Hansard Report
Bermuda House of Assembly The Deputy Speaker: Yes.
Hon. Diallo V. S. Rabain: Now, as my ministerial colleague Minister Jason Hayward said, I would love to see proof from anyone who sits Opposite, who actually is not in the Chamber now, to point of order me and say—well, the third consultation started November 15. He said these words on November 1. Did he submit those as part of the consultation?
The Deputy SpeakerDeputy SpeakerHmmm. Hon. Diallo V. S. Rabain: Has he talked about this? Has he come and said, Hey, let’s have a conversation around this before the Bill is tabled. But yet after the Bill is tabled this amendment miraculously appears and says almost exactly what he said on November 1 but …
Hmmm.
Hon. Diallo V. S. Rabain: Has he talked about this? Has he come and said, Hey, let’s have a conversation around this before the Bill is tabled. But yet after the Bill is tabled this amendment miraculously appears and says almost exactly what he said on November 1 but they are saying we just came up with it . Political posturing. That is all it is. And I challenge anyone Opposite to point -of-order that because that is all it is, Mr. Deputy Speaker . Political posturing at a time when we can least afford it, wh en we should all be singing from the same hymnbook.
The Deputy SpeakerDeputy SpeakerYes. Hon. Diallo V. S. Rabain: A time when we should be setting the bar high for other countries that are looking at us and saying, Look what they are doing. Look how they are working together. Look what they are accomplishing. But instead we are getting the same old …
Yes.
Hon. Diallo V. S. Rabain: A time when we should be setting the bar high for other countries that are looking at us and saying, Look what they are doing. Look how they are working together. Look what they are accomplishing. But instead we are getting the same old tired line that, as I said, Mr. Deputy Speaker, we cannot even blame them because it is so engrained in their psyche they do not even realise that they are being offensive when they say it anymore because they have just said it all their lives. Mr. Deputy Speaker, I get ribbed for this by colleagues. I attended the Saltus Grammar School for high school. But, Mr. Deputy Speaker, I resurrected myself by attending an HBCU [historically Black colleges and universities].
[Laughter]
The Deputy SpeakerDeputy SpeakerYes. Hon. Diallo V. S. Rabain: Mr. Deputy Speaker, and you know what, one of the biggest things that I realised at 18 years old starting university is that Bermuda is a very politely racist place.
The Deputy SpeakerDeputy SpeakerHmmm. Hon. Diallo V. S. Rabain: Because when I went to school, the things that I would accept as normal lan-guage my colleagues in school were like (and I won’t use the language they would use), What is going on in your country that that would even be acceptable to …
Hmmm.
Hon. Diallo V. S. Rabain: Because when I went to school, the things that I would accept as normal lan-guage my colleagues in school were like (and I won’t use the language they would use), What is going on in your country that that would even be acceptable to be said to a Black person walking down the street? The Deputy Speaker: Mm-hmm.
Hon. Diallo V. S. Rabain: Mr. Deputy Speaker, I resurrected myself. [Laughter]
Hon. Diallo V. S. Rabain: Right? And I came back to this Island. I redeemed myself. Reprogrammed myself.
[Inaudible interjections]
The Deputy SpeakerDeputy SpeakerBreak it down, yes. You got to break it down for — Hon. Diallo V. S. Rabain: Reprogrammed myself and understood that this Island had a long way to go—
The Deputy SpeakerDeputy SpeakerMm-hmm. Hon. Diallo V. S. Rabain: —and the more we keep hearing from persons like the Member that sits in the other place, who pretends to be our friend or the friend of Bermuda but honestly he probably doesn’t even recognise that he is offensive in the language that he …
Mm-hmm.
Hon. Diallo V. S. Rabain: —and the more we keep hearing from persons like the Member that sits in the other place, who pretends to be our friend or the friend of Bermuda but honestly he probably doesn’t even recognise that he is offensive in the language that he uses. Mr. Deputy Speaker, political posturing is not what we need today and that is all we have seen and all we continue to see from members Opposite. I ask them to put Bermuda first for a change.
The Deputy SpeakerDeputy SpeakerYes. Hon. Diallo V. S. Rabain: Put the people of Bermuda first for a change and be genuine about it. Be sincere about it. Make it feel like you actually do care that Bermudians need to come first in their country and that we (as a collective) can get this …
Yes. Hon. Diallo V. S. Rabain: Put the people of Bermuda first for a change and be genuine about it. Be sincere about it. Make it feel like you actually do care that Bermudians need to come first in their country and that we (as a collective) can get this done and get this across the line, Mr. Deputy Speaker . Don’t give us lip service. Don’t fool our people. Don’t pretend that you have changed when you have not.
The Deputy SpeakerDeputy SpeakerHmmm. Hon. Diallo V. S. Rabain: Have that come- to-Jesus conversation with yourself in the mirror.
The Deputy SpeakerDeputy SpeakerGlory. Hon. Diallo V. S. Rabain: And say, How can I reject my social programming that makes me subliminally try and point out that those people over there can’t get it done because of who they are not because of what they can or can’t do. Thank you, Mr. Deputy …
The Deputy SpeakerDeputy SpeakerThank you for not being repetitious. That was . . . oh, we have one more. Thank you, Minister Rabain. Bermuda House of Assembly Lt. Col. Hon. David A. Burch: Yes.
Lt. Col. Hon. David A. BurchBut I noted that my colleague who just spoke forgot to do something. So I am going to do it for him. [Laughter]
Lt. Col. Hon. David A. BurchAnd that is to ask the Minister of Finance to remove that person from the Committee because it does not appear to me as if in any way, shape or form are they interested in following the procedure. They would much rather give their sub-missions to the peopl e via …
And that is to ask the Minister of Finance to remove that person from the Committee because it does not appear to me as if in any way, shape or form are they interested in following the procedure. They would much rather give their sub-missions to the peopl e via ZBM. And so I make that request of the Minister of Finance to remove him and invite the OBA to appoint somebody else. Thank you.
The Deputy SpeakerDeputy SpeakerThank you, Minister Burch. [Desk thumping]
The Deputy SpeakerDeputy SpeakerThe Chair recognises the Honourable Member Kim Swan. Mr. Swan, please—
Mr. Hubert (Kim) E. SwanI have been listening intently and the Honourable Minister Rabain prompted me to be reminded of the bogeyman. And the bogey-man in Bermuda politics was independence and income tax.
Mr. Hubert (Kim) E. SwanThose two words could cause persons . . . and I declare my interest. I ran for election in 1983, which this is the 40 th year, so it was quite some time ago when I first ran. And I remember that when you had elections percolating around that time, …
Those two words could cause persons . . . and I declare my interest. I ran for election in 1983, which this is the 40 th year, so it was quite some time ago when I first ran. And I remember that when you had elections percolating around that time, there were code words that were used to cause people to have doubt. Independence caused persons to have doubt about whether or not the Labour Party, who . . . the Progressive Labour Party has always supported independence (as do I).
Mr. Hubert (Kim) E. SwanI voted for it in 1995. I stood at the polls for it in 1995 while supporting a conservative government at the time and a leader who would have you (at that time) think today that he didn’t support it but recruited persons based on it. Some persons would allow …
I voted for it in 1995. I stood at the polls for it in 1995 while supporting a conservative government at the time and a leader who would have you (at that time) think today that he didn’t support it but recruited persons based on it. Some persons would allow him to rewrite his history in his late 80s, but I am certainly not going to allow it to happen because I know better.
[Inaudible interjections]
Mr. Hubert (Kim) E. SwanThe other word was income tax and the Progressive Labour Party, because I know when I first came into the legislature in November of 1998 as a Senator and served in another place, we had a library then at the House of Assembly and it had all the speeches of …
The other word was income tax and the Progressive Labour Party, because I know when I first came into the legislature in November of 1998 as a Senator and served in another place, we had a library then at the House of Assembly and it had all the speeches of L. Frederick Wade who was t he Shadow Minister of Finance before Mr. Cox, and then Mr. Cox, and also Throne Speech Replies which were presented by the various leaders of the Progressive Labour Party who had outlined what the Progressive Labour Party stood for and platforms were put forward. So there was no guessing that the Progressive Labour Party always stood for a more progressive tax system. But because Bermuda had a model that was working well for many and the trickle- down economics that people publicly spoke about where the crumbs would fall from the table and we could get it because we were working . . . and I say we, persons of African descent in Bermuda would work two, three and four jobs to survive and there were plenty of jobs around to be had. But those code words income tax and independence were used in a frame. And I remember a speech by Dale Butler in the House of Assembly, I can remember because I used to come to the House every Friday when I sat in another place, so a lot of times I thought I was there anyway, sitting there next to Mr. [Stanley] Lowe, having served under him from 2007 to 2012. And I remember Dale Butler, the former Minister 308 15 December 2023 Official Hansard Report
Bermuda House of Assembly at that time, giving the famous three “ I’s” speech of how persons would use code words to frame how they wanted persons to think about the Progressive Labour Party as incompetent , always going to bring you to independence and going to force income tax down your throat. Now look at the modern framework today. We are debating a Bill that talks about corporate income tax for multi -national [companies] with revenue of € 750 [million] or more. But it hasn’t been caused by the Pro-gressive Labour Party. The Progressive Labour Party has worked collaboratively with every stakeholder possible in this country to come up with a model that works best. For who? Every man and woman, company, that calls themselves part of Bermuda. We are doing it for the good of this country. But it is not something that 40 or 50 years ago persons would have thought was the bogeyman . . . the irony of the good father is really something. He has put it so that we are here to preside over a system that is going to be fair and equitable for this country.
Mr. Hubert (Kim) E. SwanAnd that is worth noting given when historians look back on this country and they look back with a fine- tooth comb to see what took place in the 1950s. Who benefited from the system that took place in the 1950s and before?
Mr. Hubert (Kim) E. SwanWho are the beneficiaries of the system that [was] put in place, and who was calling for a more fair and equitable system in this country? And then who (when given the opportunity) did things that were fair?
Mr. Hubert (Kim) E. SwanIn many spheres, as persons used those code words, dog whistles as persons use, my colleagues in the United States would say that dog whistle language that allowed people to get tickled up and feel uncomfortable. Oh, I don’t feel comfortable. I don’t feel comfortable about what they would do …
In many spheres, as persons used those code words, dog whistles as persons use, my colleagues in the United States would say that dog whistle language that allowed people to get tickled up and feel uncomfortable. Oh, I don’t feel comfortable. I don’t feel comfortable about what they would do if they were in power. I don’t feel comfortable. They are going to bring us income tax but it is okay for the OECD and countries like Britain and the like who are our competitors!
Mr. Hubert (Kim) E. SwanMP Dunkley spoke well when he referred to the balance that is needed when persons out there were to pretend to be your friend until something comes along that benefits them better and then you find out how friendly or how much of a friend you are. I know a …
Mr. Hubert (Kim) E. Swan—wicket that is very important. I think it is important to repeat some of the facts as they exist on this subject matter because we in this country would ignore that if . . . and I will say this, as someone who has stood firm all my life to …
—wicket that is very important. I think it is important to repeat some of the facts as they exist on this subject matter because we in this country would ignore that if . . . and I will say this, as someone who has stood firm all my life to say I would like to see my country run its own affairs and not have to look to the mother land for it. Whilst we still hold hands with the mother land and do business, but do it on a more mature level because if the mother land woke up tomorrow and decided that they are going to Brexit all their Overseas Territories the way they Brexited all their European cousins and sisters over there (right?) we would have to find a way just like they threw income tax on our lap today. We would have to find a way. And we will! And guess who will be holding hands with us? The same folks who set the narrative, Don’t, the PLP is going to bring you income tax and given the chance to have to do it, we did it in a way that is fair and equitable and did it in a way that we collaborated with all the stakeholders! My, my, my, my, my. What irony our good father brings forth in this world.
Mr. Hubert (Kim) E. SwanBut the historians when they look back and they say, My, my, my what fair - minded people we have!
Mr. Hubert (Kim) E. SwanYou know, so many questions that were . . . how will this new corporate income tax affect Bermudian businesses, Mr. Deputy Speaker ?
Mr. Hubert (Kim) E. SwanWell, I am told that local Bermuda businesses will not be impacted by the proposed corporate income tax. Will not! And, you know, wills and shalls and mays and maybes says will not .
The Deputy SpeakerDeputy SpeakerNot. B ermuda House of Assembly Mr. Hubert (Kim) E. Swan: But, if you let somebody that is anti -PLP who has the pen (they say the pen is mightier than the sword, right?) who are out there writing let me find a way to create a new bogeyman . …
Not.
B ermuda House of Assembly Mr. Hubert (Kim) E. Swan: But, if you let somebody that is anti -PLP who has the pen (they say the pen is mightier than the sword, right?) who are out there writing let me find a way to create a new bogeyman . They will have you out there saying, Don’t worry. Those lots are going to be taxing your business down there on the corner. They will have you believing that, and they wouldn’t tell you none the different if it allowed somebody to look at anyone of us cockeyed and with ma-lintent. That is what happens out there. I have lived long enough to know how this politics truly works. They don’t mind if they somewhat malign your integrity. They don’t look at the fact that the Honourable Member who grew up in St. George’s that represents the good people down there in Devil’s Hole that is an accountant. That he had one of the highest accounting jobs in the land, that he is somewhat well -educated as well. No, that matters much. He is PLP, how could he be? He hasn’t qualified the fact that he has . . . he has to let people know . . . maybe bring out his résumé and say, Look , I have done this, this, this, this and this , and I was one of the top from my class. Oh no, Mr. Deputy Speaker, I know the way they go because I have seen the way some of us could walk in another land and get the total respect and in our own land spend all of our lives trying to qualify what we know. Why? Because that is the type of Bermuda, that is the type of institutional racism that this country was founded on. To create a system that benefits persons no matter how bad they are! The proposed [Corporate] Income Tax 2023 only affects large multi -national companies with revenues of €750 million (that’s almost a billion) or more. So that is very large companies, indeed. How does the new corporate income tax benefit Bermuda citizens? Oh, that is a good one.
Mr. Hubert (Kim) E. SwanBecause all the narratives around persons who are trying to find every way to . . . and if ever there was a subject, I think MP Dunkley did some justice there in that if there is ever a subject that certainly needs a bipartisan flair, it is here today. …
Because all the narratives around persons who are trying to find every way to . . . and if ever there was a subject, I think MP Dunkley did some justice there in that if there is ever a subject that certainly needs a bipartisan flair, it is here today. The same flair that exists at White Hall and was instructed by Westminster that Brexit is the order . . . what would they call if it is Brexit for the European Union? What would it be for . . . you know, backing out of the OTs, particularly the Caribbean ones, we would have to find a way to do it. [ Inaudible interjections]
Mr. Hubert (Kim) E. SwanAnd that is a reality that we must be prepared for. And the type of people that we are collectively in this country, I know we would rise to the occasion—together too!
The Deputy SpeakerDeputy SpeakerMm-hmm. Mr. Hubert (Kim) E. Swan: Just like Hurricane Emily and Hurricane Fabian and Hurricane Fay (that snuck up on us), we would find a way. So what is the answer to that, How does corporate income tax benefit Bermuda ? The Government aims to reduce the cost of living …
Mm-hmm. Mr. Hubert (Kim) E. Swan: Just like Hurricane Emily and Hurricane Fabian and Hurricane Fay (that snuck up on us), we would find a way. So what is the answer to that, How does corporate income tax benefit Bermuda ? The Government aims to reduce the cost of living and doing business in Bermuda. The PLP Government aims to reduce the cost of living and doing busi-ness in Bermuda . Now why should you believe that for one minute, people would ask? Well, I can tell you this much and I learnt it when I wasn’t PLP. Every Wednesday (in another place), I would do my best to tickle ‘em up. Oh, yes. Lunchtime . . . because we used to stay late down there. A fellow would come upstairs with a stack load of papers, done some research, come up there and start banging back . Right? He would say this, Bring out the book . This is the manifesto. Get it in your head. This is what we are working off of . We didn’t just start using these manifestos, you know. You have been up there reading them . . . I was up there reading them. They had been coming out every year since 1968. But let me tell you something, this one here, we are going to tick down, tick down, tick down, tick down. When we are through with that we may call the election and put out another one! If you go back and look for every year from 1998 to 2023, save and except when we weren’t in Government from 2012 to 2017, when the debt went through the roof! You would see manifesto promises that were worked off of by this PLP Government . And in the midst of that, a global recession which was blamed on the PLP . . . remember the 2007 recession? After the country enjoyed the greatest buoyancy in its economic history between 2001 and 2006— under PLP and a lot of folks did very well, thank you very much, then. No talk about that. All right? Then the global recession comes. In America, after that, because that was caused by boardroom de-cisions. It wasn’t caused by decisions like the workers in Bermuda. But Bermuda got the blame for it while it was taking place in Bermuda. I guess it was the PLP’s fault that XL [Group] went down to $2. That AIG, American International, changed their name. That British American folded and persons like my mama who put their money out in their gas tubes didn’t get what they invested in. That Madoff and Stanford and those boys cleaned house and cleaned out a lot of people—and probably had friends in Bermuda , too.
Mr. Hubert (Kim) E. SwanThe Bank of Butterfield had to come to the PLP Government for a guarantee to survive. You see these people who get laid off at their jobs around Christmas time and stuff like that, right. It wasn’t the Progressive Labour Party’s, from our policies, that caused this. It was boardroom …
The Bank of Butterfield had to come to the PLP Government for a guarantee to survive. You see these people who get laid off at their jobs around Christmas time and stuff like that, right. It wasn’t the Progressive Labour Party’s, from our policies, that caused this. It was boardroom decisions that caused that recession! And then the pandemic. My, my, my. 310 15 December 2023 Official Hansard Report B ermuda House of Assembly So we are navigating through all of that and thankfully we have a Government that cared enough about the people. And the Finance Minister of the day (and I gave him credit for the way in which he handled it) said we are going to provide for the people and we have to do it swiftly so some of the mechanisms weren’t traditional. That is a caring Government because the pandemic wasn’t traditional.
Mr. Hubert (Kim) E. SwanWell, I am talking about how we deal with this corporate . . . and I am asking . . . and I digressed.
The Deputy SpeakerDeputy SpeakerYes, you did. [ Inaudible interjections and laughter ]
Mr. Hubert (Kim) E. SwanBut I haven’t talked about Louis Corbin or Uncle Herman yet. [ Laughter]
Mr. Hubert (Kim) E. SwanBecause the bet was that he couldn’t get up without talking about him and I said I love him so much I am going to mention their names in spite of it. [ Laughter]
Mr. Hubert (Kim) E. SwanBut the corporate income tax on global companies will generate, Mr. Deputy Speaker, additional revenues to allow the Government to restructure additional domestic taxes. The Government , just like the Government has a manifesto, has been confronted with something that wasn’t on the ta-ble, that came after the whole world …
But the corporate income tax on global companies will generate, Mr. Deputy Speaker, additional revenues to allow the Government to restructure additional domestic taxes. The Government , just like the Government has a manifesto, has been confronted with something that wasn’t on the ta-ble, that came after the whole world went through a pandemic, after the great 1 per cent got cleaned up in the world, we had to recalibrate. But we put it in writing. And if there is anything that has to go beyond this term into the next term of our Government —
Mr. Hubert (Kim) E. Swan—it will be put in writing again so that we can then start saying we are doing this, we are working in this direction. There are no guesses. There is no guessing as to what we are going to do. The bogeyman doesn’t have currency in the PLP. It did …
Mr. Hubert (Kim) E. SwanAnd when you are brought up with the bogeyman, sometimes you can’t shake it. So maybe that is some personal therapy for persons who might be able to look in the mirror and see that the bogeyman still lives on their door. But this country needs to move beyond that. …
Mr. Hubert (Kim) E. SwanHow did corporate income tax come about? That is another question. The Ministr y of Finance created an I nternational Tax Working Group. The D eputy S peaker: That has b een covered, y ou know.
Mr. Hubert (Kim) E. Swan—a nd state because everybody has a different constituency that sometimes buys into that and that is why we have 30 . . . this many Members . . . and I certainly have a constituency that listens and I certainly want to make sure that in the country vernacular …
—a nd state because everybody has a different constituency that sometimes buys into that and that is why we have 30 . . . this many Members . . . and I certainly have a constituency that listens and I certainly want to make sure that in the country vernacular that I present, Mr. Deputy Speaker — The Deput y Speaker: Sir. [Hon. Dennis P. Lister, J r., Speaker, i n the Chair]
Mr. H ubert (Kim) E. SwanThe final po ints, When will corporat e income tax c ome i nto effect? When will Government receive tax revenues? are all very important points. All v ery important t hings. But i t is ant icipated, Mr. S peaker, that t he corporate income tax w ill begin …
The final po ints, When will corporat e income tax c ome i nto effect? When will Government receive tax revenues? are all very important points. All v ery important t hings. But i t is ant icipated, Mr. S peaker, that t he corporate income tax w ill begin to have a meaningful impact o n the G overnment in 2026. I will leav e it up t o thos e who ar e task ed with due diligence, b oth at t he Ministry of F inance level, bot h from a political a nd a technical level and the
Bermuda House of Assembly collaborative arms that have been galvanised to work in the best interests of this country. We all love this country. Sometimes our politics allows us to get carried away and I think the Opposition may have done so in some respects. But I know this much that we all love this country and that is the one common thing we have in common. We love this country and it wasn’t the PLP that caused the need for the corporate income tax but we are the custodian of this wonderful, beautiful Bermuda and we are going to d o what is required for the best of this country and I just want to thank you for the opportunity, Mr. Speaker .
The SpeakerThe SpeakerDoes any other Member wish to speak to the matter?
An Hon. Member An Hon. MemberNo. [Laughter]
The SpeakerThe SpeakerNo other Member? Premier. Hon. E. David Burt: Mr. Speaker, I would just ask if you would reset my time. I will not try to be too long but I know there were some comments that came so I want to make sure that I, as I close the principles …
No other Member? Premier.
Hon. E. David Burt: Mr. Speaker, I would just ask if you would reset my time. I will not try to be too long but I know there were some comments that came so I want to make sure that I, as I close the principles of the debate out and take us to Committee, I just want to make sure that I c an adequately cover some of the issues or questions that were raised. Where I will like to certainly start is by thanking all Members who have contributed to the debate today in this very important matter of which we are dealing with in this House. No matter what opinions you may have or thoughts or motivations, there is on e thing that is particularly clear: that this is an historic piece of leg-islation that is changing the way in which we deal with taxation in this country, keeping us in line with emerging global trends and once again demonstrating that Bermuda is able to h andle complex global issues well. I would like to thank the Members on my side, for Minister Furbert, to MP Dickenson, to MP Richardson, MP Swan, Minister Campbell, Minister Furbert, Minister Rabain, Minister Burch and MP Adams who have all given—
[Inaudible interjections]
Hon. E. David Burt: —and the Deputy Premier, my apologies, who have all given great contributions . . . did I miss anyone else?
[Inaudible interjection]
Hon. E. David Burt: I don’t think so. Got it. Who have all given great contributions to the debate today. I want to deal . . . and MP Famous, as well. I want to deal with some of the issues and questions that were raised because MP Swan had said things related to the matter of the bogeyman. And earlier today I was talking about the straw man. But it is important that we recognise and understand that though the Progressive Labour Party is the governing party of Bermuda, this Bill is a Bill from the Government of Bermuda for the people of Bermuda and for the wider society. This is not something that was drafted in the Ministry of Finance. This was not something that came to the Minist ry of Finance and we said we have all of the technical expertise an d all the knowledge and we can make this work and make this happen. That is not how this was done. We went to the experts, the people who do this day in and day out, and they were the ones who said faced with what you are faced with, knowing the way that things operate in the world, understanding the direction of travel, based upon the risk and the opp ortunity, this is the recommended way forward. That was them, Mr. Speaker, not us. When I hear from the Member Opposite who speaks for Finance in this Chamber, the Honourable Member from constituency 22 it is, I believe, when he says, We are concerned that this may not be the right path, I have to question: how does he know more than the international tax experts who were assembled to advise the Government of Bermuda on this? The Honourable Member from constituency 22. I don’t get, Mr. Speaker, how? Has the Honourable Member declared his interest and said he is a partner at Conyers and said that they were working on this, and persons from their organisation working from it? Bringing together the foremost experts in tax who came together and gave countless hours around this. W ho have all, from the organisations in the last few days, commended the Government ’s approach and supported the direction. I do not get how the Honourable Member stands up, says he is speaking on beh alf of the Opposition and then says that we are concerned that this may not be the right path. You see, Mr. Speaker, as I said in the brief, this Government has a history of collaboration, has a history of tackling difficult issues through a consultation process and ensuring that we can advance in a collaborative fashion by building consensus. We have done it on numerous issues when the international head-winds are faced, where they come up time and time again and we managed to succeed. I will say that it is disappointing . . . disappointing that the Opposition believes that they know better than the foremost tax experts that we have assembled.
POINT OF ORDER [Imputing improper motive]
Mr. Scott PearmanPoint of order, Mr. Speaker . The Honourable Premier is imputing motive. There is no suggesting that we know better and we were very clear that no one knows because it is a speculative terrain that we are embarking upon. 312 15 December 2023 Official Hansard Report Bermuda House of …
Point of order, Mr. Speaker . The Honourable Premier is imputing motive. There is no suggesting that we know better and we were very clear that no one knows because it is a speculative terrain that we are embarking upon. 312 15 December 2023 Official Hansard Report
Bermuda House of Assembly Thank you.
Hon. E. David Burt: Mr. Speaker, I will quote the Honourable Member again. He said, We are concerned that this may not be the right path. The path that was ad-vised on and agreed on by a wide cross -section of Bermudian tax experts from our international business sector, our accounting firms, our law firms. Again, the only conclusion that someone could make is that they believe that they know better than the panel of experts that advise the Government .
POINT OF ORDER [Misleading]
Mr. Scott PearmanPoint of order, Mr. Speaker . The Honourable Premier is misleading the House. The expression of concern is not a statement that what you are concerned about is right or wrong. It is an expression of concern which is perfectly legitimate. To impute a motive and suggest that we are …
Point of order, Mr. Speaker . The Honourable Premier is misleading the House. The expression of concern is not a statement that what you are concerned about is right or wrong. It is an expression of concern which is perfectly legitimate. To impute a motive and suggest that we are somehow arro-gantly —which was a word you used earlier —thinking we are smarter than anyone else is simply not right. It is an expression of concern . . . and I think we should all be concerned.
Hon. E. David Burt: Mr. Speaker, it sounds like a former President of the United States who says that it depends on what the definition of “is” is. [Laughter]
Hon. E. David Burt: Because he said we are concerned that this may not be the right path. And so I will then tackle the rest of where the Opposition started because I saw they took umbrage of the moniker of which I assigned to three of their Honourable Member s.
[Inaudible interjections]
Hon. E. David Burt: But . . . and he says he welcomed it. Well, I will go with another one because remember how we said—
[Inaudible interjections]
Hon. E. David Burt: Remember . . . oh, here he goes. Here he goes. He can’t listen. Didn’t interrupt him, you know.
[Inaudible interjections]
Hon. E. David Burt: Point -of-ordered me a few times, but I made sure I waited until the end. But here we go, Mr. Speaker, because I will make it very clear on this particular case and instance, Mr. Speaker . When you need to resort to straw men arguments to try to get your point across, it means that you do not have an argument to make. Some people may ask, What is a straw man argument? And I will just state, Mr. Speaker, that a straw man argument is a rhetorical technique where someone misrepresents, exaggerates or fabricates another person’s argument in order to easily refute or criticise it. It involves arguing against a position that the opponent doesn’t actually hold or has never expressed, creating an il lusion of having effectively countered their argument.
Mr. Scott PearmanWhich you are doing right now. Hon. E. David Burt: So here we go, Mr. Speaker . We heard the Honourable Member say be very wary of people who say bad things will not happen. And every-one said, Who said that? [Inaudible interjections] Hon. E. David Burt: Be very wary …
Which you are doing right now.
Hon. E. David Burt: So here we go, Mr. Speaker . We heard the Honourable Member say be very wary of people who say bad things will not happen. And every-one said, Who said that? [Inaudible interjections]
Hon. E. David Burt: Be very wary of people saying that no companies will leave. Nobody said that. But here we go again, Mr. Speaker, constructing these straw men arguments is a tool that is used and the question that is posed is, Why do people construct straw man arguments? And there are six reasons given, which I think apply: to avoid addressing strong arguments, to appeal to emotions, to mislead or confuse, to gain tactical advantage, to oversimplify the narrative or due to lack of understanding. Mr. Speaker, I would argue that most of those apply to the Honourable Member . Now let me take it to one more space because the Honourable Member took great pleasure in quoting the Fiscal Responsibility Panel and the comments which they made. Here is the thing, Mr. Speaker , I support what was laid out in the Fiscal Responsibility Panel Report because those are the exact same things that I have discussed with the Tax Reform Commission chair. It is about making sure that we do this in a fair and balanced manner. But here is the thing, Mr. Speaker . The Fiscal Responsibility Panel are three persons. The One Bermuda Alliance are six. The PLP are 30. The country 60,000. That is the reason why we have assembled a Tax Reform Commission that has representatives from unions and local business and international business and political parties so that we can consider all of the matters, to come to a space of consensus just like we have come to a space of consensus on this corporate income tax. The straw man argument that is being put in place, the dog whistle politics of . . . the comments that were made by their Members which says we cannot trust the Government with the money, we need to put protections in place. It harkens back to exactly what MP Swan said. And it is offensive to the Government , and it should be offensive to the public because we know and we understand our rights and responsibilities and understand how big of a moment this is. Just as we have to date navigated these complex issues, to the support from Members on both sides, we c an navigate
Bermuda House of Assembly the complex issues that will come in dealing with the matters that we have to deal with before 2025 when this tax comes into place. Now let me address some general points as I wrap up to take us to Committee, Mr. Speaker , because it is international business that is emphatic that we get this on the books by 2023, before its effective date in 2025. And guess what? Just as we said before, it is not for us to argue with the experts who do tax, day in and day out. The other thing is when some persons are saying we are rushing into this, the effective date of 1 January 2025 is largely in step with what other jurisdictions approaches are in respect to Pillar Two adoptions. And bringing this now, a full year before th e effective date, provides a runway for proper implementation, transi-tioning and monitoring of global activity. The Honourable Member from constituency 22, as well, had mentioned about the United States and mentioned about Cayman and all those things and tried to of course give the impression that be careful , we know where he is trying to go. And here is what I will say, Mr. Speaker . The concern is not with the United States or with the Cayman Islands. It is with the breadth of global implementation. Remember, this is a global tax, Mr. Speaker , and we are in a position to reposition or change if the future doesn’t h appen as expected. But are we to wait until a month before 1 Janu-ary 2025 and then all of a sudden we are left scrambling? No. That is not the way that responsible governments handle business. It is important to note . . . it is not that this process risked making us uncompetitive. It is quite the opposite. It ensures that we remain competitive. I encourage Honourable Member s and persons who talk to leaders in international business, speak to them about the way in which the Government has handled this process and the opportunities that can come from this process. I was at an ABIC board meeting yesterday where a member was saying, I don’t understand why there is all this hysteria. We are seeing persons who are appreciative of this and we actually think Bermuda will get more business and not less because of the direction of travel and how responsibly the Government is handling this issue. That is what they are saying, Mr. Speaker . That is what they are saying. [Pause]
Hon. E. David Burt: I am just making sure that I cover all the questions that were asked, Mr. Speaker , and raised. When it comes to the general comments that we . . . yes. The Opposition also indicated that we must monitor and take into consideration what other competitor jurisdictions are doing with respect to the GMT and the response is very simple, Mr. Speaker, that in collaboration with our key stakeholders, that is precisely what the Government has done. The reality is that a substantial portion of the international busi ness community that are in scope for this legislation will pay taxes in some other jurisdiction and this time of putting it in 2023 has followed from the meaningful consultation that we have had with the international business industry. What I would say from a competitive landscape perspective, the question that we must ask the Opposition is, Where is the GMT not happening? Because companies will not be able to escape it if they are in scope entities. Additionally, the Honourable Member who speaks for Finance in this Honourable Chamber, the Honourable Member for constituency 22, MP Pearman, has stated that the United States is not moving forward with the global minimum tax. Here are the facts, Mr. Speaker . The United States does have GILT I [Global Intangible Low -Taxed Income], the provisions were introduced in 2017, something that we know well because it was the first tax matters that we had to nav-igate. And that served as the precursor to the global minimum tax regime and the United States has recently introduced its own minimum tax provision referred to as a CAMT (corporate alternative minimum tax) rules, so they have implemented their own form of global tax. When we compare ourselves to our neighbour in the south, the Cayman Islands (I was just speaking to the new Premier the other day), Cayman has a totally different economy than Bermuda . We would posit that if they had the same level of global reinsurers that we have in Bermuda, they would probably be going the exact same direction. The thing is that they have a limited number of multi -national enterprises in scope because their main business is the funds business which is exempt and only a handful of multi -national enterprises which are resident in Asia. The one thing I am not going to get into, Mr. Speaker, as I close is the matter of qualified refundable tax credits because next year, we will have plenty of time to debate those. I do want to say that I can accept some of the arguments that were made by the Honourable Member from constituency 10 that says, you know, make sure that we don’t get the hopes of the people up. And I accept that. The truth is we don’t know what the future will hold. That is why we are continuing to go through this particular process, doing the modelling, putting the legislation in place, continuing to consult so that we can get to realistic figu res. But what we do know is that international businesses have signalled and agreed that they accept the Government ’s position (as other persons have said) that we need to make ourselves more competitive. And the one way you make yourselves competitive is by reducing the cost of business and the cost of living. The Government can do that if there is the space after the analysis to reduce taxes that increase the cost of living and the cost of doing business. That is where that is coming from and that is something that is broadly supported. From that particular aspect, Mr. Speaker, I think that it is important that as we move into the 314 15 December 2023 Official Hansard Report
Bermuda House of Assembly Committee that we remember that these provisions of which we have set out, these complex matters which are laid out here are not just coming from the Progres-sive Labour Party Government . They are coming from industry and those that want to scaremonger from an uninformed position need to take the time to have the conversations with the experts in this field who have all publicly supported the Government ’s approach on this issue and are continuing to work with the Government for it on this issue. With that, Mr. Speaker, I think that I have answered all of the questions. I will close in this general debate by saying that this is a historic day. It is a day that I had hoped would have less partisan rancour, but I am used to it. And the fact is, Mr. Speaker, that despite what distractions may be placed by the Members on the other side, what will be the case is that today we will pass historic legislation that will set Bermuda on a path of leadership and that can certainly benefit our economy if we all come together and responsibly deal with what we may do with these new streams of reve-nue that will come in so they can best help the entirety of the country. No narrow segment, but the entirety of the country. With that, Mr. Speaker, I move that the Bill be committed.
SPEAKER’S RULING [Standing Order 28 —Introduction and First Reading of Bills]
The SpeakerThe SpeakerDeputy, hold on one sec. Premier? Before we go to Committee, I think it is only fitting that I deal with the matter that I think should be dealt with from my Chair. I am aware of the fact that the Opposition intend to bring an amendment to the Bill …
Deputy, hold on one sec. Premier? Before we go to Committee, I think it is only fitting that I deal with the matter that I think should be dealt with from my Chair. I am aware of the fact that the Opposition intend to bring an amendment to the Bill and I think it is best it is dealt with now. The issue that circulates around the amendment being put forward, accepted, falls around the guidelines that affect a money Bill. The Bill that is before us now, the Corporate Income Tax [2023] has been deemed as a money Bill. It was consented by the Gover nor as a money Bill, which means the impact of amendments (changes to a money Bill) can only be done by the guidelines that affect it as a money bill. The guidelines of our Standing Orders are clear that amendments, adjustments, laying of any Bill that is a money Bill, can only be done by a Minister. Standing Order 28(5)(1) speaks to that. And with that, I will have to make ruling that the amendment that the Opposition would like to table falls outside of the guidelines of that Standing Order. For that reason, the amendment will not be accepted.
The SpeakerThe SpeakerI will hear you for the record. Mr. Scott Pearman: I am grateful. Mr. Speaker, our argument would be this: Standing Order 28 provides for certain prohibitions that would not allow us to move an amendment to a money order bill. None of those prohi-bitions apply in this instance. I …
I will hear you for the record. Mr. Scott Pearman: I am grateful. Mr. Speaker, our argument would be this: Standing Order 28 provides for certain prohibitions that would not allow us to move an amendment to a money order bill. None of those prohi-bitions apply in this instance. I don’t know which of the four have been identified by t he Government as being a valid prohibition but —I am not challenging the Speaker in any way. I am simply setting out our case. I understand from the Speaker’s office in a conversation that we have had that the way the argument is put by the Government is that this should be prohibited because it amounts to a withdrawal from the Consolidated Fund. Mr. Speaker, I would simply say this, the imposition of a restraint on how you may not spend your money does not equate to compelling you to withdraw your money. They are not the same. The first is a neg-ative, you must not. The second is a prohibitive. You must. We are not seeking a positive. We are not compelling any withdrawal. We are simply seeking restraint which is a negative and therefore, in my respectful submission to you, Mr. Speaker, the amendment should be allowed to proceed. Thank you for allowing me to say so.
The SpeakerThe SpeakerI gave you the opportunity. And as I stated before that, I have made my ruling. My ruling was based on the fact that that same reference that you make speaks to the Consolidated Fund. Any funds that are generated from this new taxation will go into the Consolidated Fund …
I gave you the opportunity. And as I stated before that, I have made my ruling. My ruling was based on the fact that that same reference that you make speaks to the Consolidated Fund. Any funds that are generated from this new taxation will go into the Consolidated Fund or any other public fund that could be created in support of that, and I am just broadening that by saying that. And the ruling here speaks to the fact that the amendment . . . only a Minister can make amendments, make adjustments, bring bi lls, bring legislation that affects the funds of Government . Even in your example that you tried to interpret just now, all funds that are raised from this tax will go into the Con-solidated Fund. And if we are now directing a payment to go elsewhere, it has got to come out of that Consoli-dated Fund. That is my ruling. I will stand by it. Deputy.
House in Committee at 8:53 pm
[Hon. Derrick V. Burgess, Sr., Chairman]
COMMITTEE ON BILL
CORPORATE INCOME TAX ACT 2023
The ChairmanChairmanHonourable Members, we are now in Committee of the whole [House] for further considera-tion of the Bill entitled the Corporate Income Tax Act 2023 Premier, Minister of Finance, David Burt you have the floor. Hon. E. David Burt: Thank you, Mr. Chairman. Bermuda House of Assembly Mr. Chairman, I would …
The ChairmanChairmanContinue. Hon. E. David Burt: Thank you, Mr. Chairman. Mr. Chairman, clause 1 provides for the citation. Clause 2 provides for the interpretation of terms used in the Bill. Clause 3 provides that the Minister may, by the negative resolution procedure, promulgate regulations relating to any aspect of the Act. …
Continue. Hon. E. David Burt: Thank you, Mr. Chairman. Mr. Chairman, clause 1 provides for the citation. Clause 2 provides for the interpretation of terms used in the Bill. Clause 3 provides that the Minister may, by the negative resolution procedure, promulgate regulations relating to any aspect of the Act. As noted in the brief, given the complexity of the matters being covered in this Bill, this approach was taken to allow for timely technical changes to be made to the Bill in periods where the legislature may not be in session, particularly during the transitional period. It must be made clear that this position will not be used for substantial changes to legislation. Such matters as the case with matters of this nature will be brought before this Honourable House for examination approval. That will certainly include matters related to the adoption of qualified refundable tax credits. It should also be noted that at an appropriate time in the future, it is likely that regulations under this Act will be subject to the affirmative resolu-tion procedure and the power to amend by negative resolution will be removed from the Act.
The ChairmanChairmanThank you, Premier. Any other speakers? There appear to be none. You want to— Hon. E. David Burt: Mr. Chairman, I move that clauses 1, 2 and 3 be approved.
The ChairmanChairmanIt has been moved that clauses 1 to 3 be approved. Are there any objections? There appear to be none. Approved. [Motion carried: Clauses 1 through 3 passed.] Hon. E. David Burt: Thank you very much, Mr. Chairman. Mr. Chairman, I would like to move clauses 4 through 7.
The ChairmanChairmanContinue. Hon. E. David Burt: Thank you very much, Mr. Chairman. Mr. Chairman, clause 4 is the charging provision which provides for the imposition of corporate income tax on the net taxable income (less any applicable tax credits) of Bermuda entities in scope of the Act. Notwithstanding any assurance given …
Continue. Hon. E. David Burt: Thank you very much, Mr. Chairman. Mr. Chairman, clause 4 is the charging provision which provides for the imposition of corporate income tax on the net taxable income (less any applicable tax credits) of Bermuda entities in scope of the Act. Notwithstanding any assurance given pursuant to the Exempted Undertakings Protection Act [1966] . Clause 5 provides for the calculation of net taxable income through the netting of income and losses, and through the deduction from any current year in-come of any brought forward losses incurred in prior years. Clause 6 provides a deduction for operating loss carryforwards incurred by a Bermuda entity. De-ductions for operating loss carryforwards are a common feature in many global tax systems and reflect the acknowledgment on the part of policymakers that cor-porate tax determinations should not be limited to a point in time assessment, but rather a longer -term measure of profitability that may extend over multiple tax periods. Clause 7 provides an exemption from taxation in respect of entities that would otherwise be in scope but have de minimis revenue and income for a given fiscal year .
The ChairmanChairmanAny speakers to clauses 4 through 7? There appear to be none. Hon. E. David Burt: Thank you. Mr. Chairman, I move that clauses 4 through 7 be approved.
The ChairmanChairmanIt has been moved that clauses 4 through 7 be approved. Are there any objections to that? There appear to be none. Approved. [Motion carried: Clauses 4 through 7 passed.] Hon. E. David Burt: Thank you, Mr. Chairman. Mr. Chairman, I would like to move Part 3 which is clauses …
The ChairmanChairmanContinue. Hon. E. David Burt: Thank you very much. Clause 8 makes provision for the grouping of the Bermuda entities of a multi- national group into various tax groups depending upon their tax attributes and makes provision for an election that allows filers to modify their tax grouping. Clause 9 …
Continue. Hon. E. David Burt: Thank you very much. Clause 8 makes provision for the grouping of the Bermuda entities of a multi- national group into various tax groups depending upon their tax attributes and makes provision for an election that allows filers to modify their tax grouping. Clause 9 defines the types of Bermuda entities potentially in scope of the Act. These would include Bermuda tax resident entities or Bermuda permanent establishments and would be entities in the insurance, banking and other sectors. Clause 10 defines those entities that are excluded from taxation under the Act. A few examples of such entities would include but are not limited to a gov-ernmental entity, a nonprofit organisation or a pension fund. Clause 11 defines the minimum revenue threshold of €750 million for a multi -national group in order for its Bermuda constituent entities to be in scope 316 15 December 2023 Official Hansard Report
Bermuda House of Assembly of the tax imposed by the Act. These scoping provisions are consistent with the Pillar Two provisions. Clause 12 makes provision for where a constituent entity has multiple parent entities. Clause 13 creates a five- year deferral of taxation where a Bermuda entity is a member of a multi - national group that has a limited international footprint. This provision has been based on provisions in this regard contained in the GloBE Rules. Clause 14 provides for rules for determining an entity’s location, chiefly for determining whether or not a group has a limited international footprint and can avail itself of the deferral pursuant to clause 13. Clause 15 contains default rules as to whether or not entities should be regarded as fiscally transparent (and thus have their income imputed to their owners) and contains provisions for taxpayers to make elections as to whether or not to treat Bermuda’s entities as fiscally transparent.
The ChairmanChairmanAny speakers to clauses 8 through 15? There appear to be none. Finance Minister — Hon. E. David Burt: Thank you, Mr. Chairman. Mr. Chairman, I move that clauses 8 through 15 be approved.
The ChairmanChairmanIt has been moved that clauses 8 through 15 be approved. Are there any objections? There appear to be none. Approved. [Motion carried: Clauses 8 through 15 passed.] Hon. E. David Burt: Thank you, Mr. Chairman. Mr. Chairman, I would like to move [Part] 4 which consists of clauses 16 …
The ChairmanChairmanContinue. Hon. E. David Burt: Thank you very much, Mr. Chairman. Clause 16 provides a foreign tax credi t which is intended to mitigate the potential for double taxation of a Bermuda [Constituent Entity] Group. Examples of foreign taxes that may receive foreign tax credit treatment are federal excise taxes, …
Continue. Hon. E. David Burt: Thank you very much, Mr. Chairman. Clause 16 provides a foreign tax credi t which is intended to mitigate the potential for double taxation of a Bermuda [Constituent Entity] Group. Examples of foreign taxes that may receive foreign tax credit treatment are federal excise taxes, withholding taxes and taxes paid to other jurisdict ions for companies that are tax residents in those other jurisdictions. Clauses 17 and 18 contains further provisions related to the calculation of foreign tax credits providing, respectively, how such foreign tax credits are to be adjusted and then allocated as between entities. Clause 19 introduces the concept of qualified refundable tax credits . As noted in the brief, detailed work to develop recommendations on the nature and scope of these credits is being undertaken by the Tax Reform Commission. These credits will not only be beneficial to the relevant entities but will also be designed to help the Government achieve key economic and social goals. Several jurisdictions have indicated their intention to develop QRTCs (qualified refundable tax credits) in the coming months and in 2024 the Government will (with the assistance and the recommendations from the Tax Reform Commission and after public consultation) design, develop and model a QRTC regime for implementation in 2025.
The ChairmanChairmanThank you. Are there any speakers to clauses 16 through 19? The Chair recognises the Honourable Member Scott Pearman. You have the floor.
Mr. Scott PearmanYes, thank you, Mr. Chairman. Just on clause 19, which is at page 36 of the draft Bill. It says, “ The form and criteria for qualified refundable tax credits shall be as prescribed,” which is [clause] 19(1). The previous draft of the Bill said that the Minister shall by …
Yes, thank you, Mr. Chairman. Just on clause 19, which is at page 36 of the draft Bill. It says, “ The form and criteria for qualified refundable tax credits shall be as prescribed,” which is [clause] 19(1). The previous draft of the Bill said that the Minister shall by regulations made pursuant to this Act prescribe . . . I am just wondering if the amendment is intended to change it, then. Who will be doing the prescribing at [clause] 19(1) of the Bill?
The ChairmanChairmanPremier. Hon. E. David Burt: I am trying to find the page, Mr. Chairman.
Mr. Scott PearmanPage 36 of the Bill. Hon. E. David Burt: Maybe I am not understanding which differences he is referring to. The only Bill that he could be referring to is the Bill that was tabled in the House last week, and a marked- up copy, and I do not believe …
Page 36 of the Bill. Hon. E. David Burt: Maybe I am not understanding which differences he is referring to. The only Bill that he could be referring to is the Bill that was tabled in the House last week, and a marked- up copy, and I do not believe there has been any change in [clause] 19 between what was tabled in the House last week and what we have today. So, can the Honourable Member tell m e what he is referring to?
Mr. Scott PearmanYes, the previous draft said that the Minister shall by regulation prescribe. The current draft, which we are debating, just says “shall be as prescribed.” And I am just wondering who is prescribing. Is it still the Minister by regulation, or is it someone else? Thank you. Hon. E. David …
Yes, the previous draft said that the Minister shall by regulation prescribe. The current draft, which we are debating, just says “shall be as prescribed.” And I am just wondering who is prescribing. Is it still the Minister by regulation, or is it someone else? Thank you. Hon. E. David Burt: The answer would be the Minister by regulation. But I am just trying to make sure that I understand the actual question, because—
The ChairmanChairmanThank you. Any further speakers to clauses 16 through 19? There appear to be none. Bermuda House of Assembly Minister. Hon. E. David Burt: Thank you, Mr. Chairman. Mr. Chairman, I move that clauses 16 through 19 be approved.
The ChairmanChairmanIt has been moved that clauses 16 through 19 be approved. Are there any objections? There appear to be none. Approved. [Motion carried: Clauses 16 through 19 passed.] Hon. E. David Burt: Thank you, Mr. Chairman. I would now like to move Part 5, which is clauses 20 through 25.
The ChairmanChairmanContinue. Hon. E. David Burt: Thank you, Mr. Chairman. Clause 20 provides for the calculation of a Bermuda constituent entity’s taxable income or loss. Clause 21 provides for the calculation of a Bermuda constituent entity’s financial accounting net income or loss, which is the first line item used in calcu-lating …
Continue.
Hon. E. David Burt: Thank you, Mr. Chairman. Clause 20 provides for the calculation of a Bermuda constituent entity’s taxable income or loss. Clause 21 provides for the calculation of a Bermuda constituent entity’s financial accounting net income or loss, which is the first line item used in calcu-lating taxable income or loss pursuant to clause 20. Clause 32 also provides a two- year provision to mitigate the potential for double taxation of Bermuda entities pending further developments in the global debate regarding the long- term approach to foreign tax credits. Clauses 22 through 25 contain provisions dealing with the allocation of a financial accounting net income or loss in respect of permanent establishments and flow -through entities.
The ChairmanChairmanThank you. Are there any speakers for clauses 22 through 25? There appear to be none. Hon. E. David Burt: Mr. Chairman, I move that clauses 20 through 25 be approved.
The ChairmanChairmanAre there any objections to that? There appear to be no objections. Approved. [Motion carried: Clauses 20 through 25 passed.] Hon. E. David Burt: Thank you, Mr. Chairman. I would now like to move Part 6, Taxable Adjustments, which is clauses 26 through 37.
The ChairmanChairmanContinue. Hon. E. David Burt: Thank you, Mr. Chairman. Clauses 26 through 35 provide for a series of adjustments to financial accounting net income or loss, including introducing transitional provisions to prevent distortions caused by subjecting an entity to corporate income tax for the first time in respect of historical …
Continue.
Hon. E. David Burt: Thank you, Mr. Chairman. Clauses 26 through 35 provide for a series of adjustments to financial accounting net income or loss, including introducing transitional provisions to prevent distortions caused by subjecting an entity to corporate income tax for the first time in respect of historical assets and liabilities that were potentially acquired or incurred in a zero tax environment. Further details of those provisions are as follows: Clause 26 provides a variety of general operative principles including provisions intended to address the interaction of a specific provision in the Act and avoid the double counting of income and expense items. Clause 27 provides for a number of tax adjustments intended to achieve consistent outcomes be-tween the Bermuda Corporate Tax and Pillar Two rules including defining specific categories of non- deductible expenses and non- taxable items. Clause 28 includes provision required to address the Bermuda Corporate Tax treatment of prior period errors recognised for financial statement pur-poses and changes in accounting policy. Clause 29 provides an adjustment related to the introduction of IFRS 17 [International Financial Re-porting Standards] or LDTI [Long Duration Targeted Improvements] provisions each of which affect the timing when profits and losses are recognised with respect to insurance contracts and may have significant tax and accounting implications for insurers. Clause 30 provides an alternative means of computing the amounts and timing of stock -based compensation expense for a Bermuda constituent entity. Clauses 31 and 32 provide insurance- specific adjustments which are consistent with provisions intro-duced as part of the Pillar Two rules. Clause 33 provides a transitional adjustment and effort to support a fair and equitable transition to corporate tax system for Bermuda constituent entities. Clause 34 provides a matching adjustment to mitigate the potential implications of a technical finan-cial accounting issue which may result in significant earnings volatility for long -term insurers with correspondingly volatile Bermuda corporate tax implications. The matching adjustment is similar to provisions which have been recently developed by the United States to address this issue in the context of its own minimum tax provisions. Clause 35 allows an entity to elect to compute taxable gains and losses on certain assets and liabili-ties as these amounts are actually realised through a sale or otherwise, thereby mitigating the volatility that might otherwise arise when taxing the entit y on the basis of fair value movement. Clause 36 provides that certain income arising from international shipping activities shall be exempt from taxation under the Act. These provisions are consistent with the Pillar Two rules which have been developed to address policy concerns that would otherwise arise given the specific manner in which international shipping activities are taxed globally. Clause 37 imposes various requirements which are intended to ensure that transactions between Bermuda constituent entities and other group members 318 15 December 2023 Official Hansard Report
Bermuda House of Assembly are recognised on an arm’s length basis for the purpose of determining taxable income or loss consistent with the approach applied in many taxing jurisdictions.
The ChairmanChairmanThank you. Are there any speakers to clauses 26 through 37? There appear to be none . Minister. Hon. E. David Burt: Thank you, Mr. Chairman. I move that clauses 26 through 37 be approved.
The ChairmanChairmanAre there any objections to that? There appear to be none. Approved. [Motion carried: Clauses 26 through 37 passed.] Hon. E. David Burt: Thank you, very much, Mr. Chairman. Mr. Chairman, at this point in time I would like to move Parts 7, 8 and 9, which are clauses 38 …
The ChairmanChairmanContinue. Hon. E. David Burt: Thank you, very much, Mr. Chairman. Clause 38 contains rules for the allocation of taxable income or loss in respect of flow -through entities that are ultimate parent entities. Clause 39 contains rules for allocations in respect of investment [entities ] in order to achieve …
Continue.
Hon. E. David Burt: Thank you, very much, Mr. Chairman. Clause 38 contains rules for the allocation of taxable income or loss in respect of flow -through entities that are ultimate parent entities. Clause 39 contains rules for allocations in respect of investment [entities ] in order to achieve consistent taxable outcome with the Pillar Two provisions. Clause 40 provides for an election in respect of investment entities and insurance investment entities insofar as the owner of such entities may elect to include the change in the fair value of their interest in such entities in their taxable income. Clause 41 provides for a taxable distribution method which is an elective provision in respect of Bermuda entities that are investors in investment entities. Clauses 42 through 46 contain rules for the tax treatment of assets and liabilities on an acquisition or disposal. Clause 47 contains provisions dealing with the conversion of amounts expressed in foreign currencies. Clause 48 makes provision for appeals to the Supreme Court. Clause 49 makes provision for taxpayers to make certain elections under this Act prior to its commencement date as a transitional measure. As an example, such an election would be a Bermuda company that wants to elect fiscal transparent entity status in 2024, such that that status is recognised internationally. Clause 50 empowers the Minister to issue guidance on the interpretation and application of this Act.
The ChairmanChairmanThank you, Premier. Are there any speakers to clauses 38 through 50? There appear to be none .
The ChairmanChairmanLet’s get these clauses approved first. Hon. E. David Burt: Oh, sorry. Thank you very much. That is kind of important. Mr. Chairman, I move that clauses 38 through 50 be approved.
The ChairmanChairmanAre there any objections to that? There appear to be none. Clauses 38 through 50 are approved. [Motion carried: Clauses 38 through 50 passed.] Hon. E. David Burt: Thank you, Mr. Chairman. Mr. Chairman, I now move clauses 51 through 53.
The ChairmanChairmanContinue. Hon. E. David Burt: Thank you, very much, Mr. Chairman. Clause 51 makes provision for consequential amendments. Clause 52 gives the Minister the power to make consequential and transitional regulations. Clause 53 provides for the commencement.
The ChairmanChairmanAre there any speakers to clauses 51 through 53? There are none. Hon. E. David Burt: Thank you, Mr. Chairman. Mr. Chairman, I move that clauses 51 through 53 be approved.
The ChairmanChairmanAny objections to clauses 51 through 53 being approved? There are none. Approved. [Motion carried: Clauses 51 through 53 passed.] Hon. E. David Burt: Thank you, Mr. Chairman. At this point in time I move that the preamble be approved. Bermuda House of Assembly The Chairman: It has been moved …
Any objections to clauses 51 through 53 being approved? There are none. Approved.
[Motion carried: Clauses 51 through 53 passed.] Hon. E. David Burt: Thank you, Mr. Chairman. At this point in time I move that the preamble be approved.
Bermuda House of Assembly The Chairman: It has been moved that the preamble be approved. Are there any objections? There are none. Approved.
Hon. E. David Burt: Thank you, Mr. Chairman. With that, I move that the Bill be reported to the House as printed.
The ChairmanChairmanAny objections to the Bill being reported to the House as printed? There are none. The Bill will be reported. Mr. Speaker. [Motion carried: The Corporate Income Tax Bill 2023 was considered by a Committee of the whole House and passed without amendment.] House resumed at 9:10 pm [Hon. Dennis …
Any objections to the Bill being reported to the House as printed? There are none. The Bill will be reported. Mr. Speaker. [Motion carried: The Corporate Income Tax Bill 2023 was considered by a Committee of the whole House and passed without amendment.]
House resumed at 9:10 pm
[Hon. Dennis P. Lister, Jr., Speaker, in the Chair]
REPORT OF COMMITTEE
CORPORATE INCOME TAX BILL 2023
The SpeakerThe SpeakerMembers, are there any objections to the Bill entitled the Corporate Income Tax Bill 2023 being reported to the House as printed? There are none. The Bill has been reported as printed. That brings us to a close of the items on the Order Paper. We will go to our …
Members, are there any objections to the Bill entitled the Corporate Income Tax Bill 2023 being reported to the House as printed? There are none. The Bill has been reported as printed. That brings us to a close of the items on the Order Paper. We will go to our third readings, and [Or-der No.] 5 on the Order Paper will be done under the third reading. I am going to do [Order No.] 5 on the original paper.
Mr. Scott PearmanThank you, Mr. Speaker. I understand this was introduced earlier by MP Adams’ motion. So, I am reading Meanwhile Insurance Bitcoin (Bermuda) Limited Act 2023. PETITION MEANWHILE INSURANCE BITCOIN (BERMUDA) LIMITED ACT 2023
Mr. Scott PearmanMr. Speaker, I move that the following petition together with the report of the Parlia-mentary Joint Select Committee on Private Bills, which was presented on 15 December 2023, be now considered, namely the petition of Appleby (Bermuda) Limited for the Standard Crypto Insurance- Bitcoin (Bermuda) Limited, an exempted company incorporated …
Mr. Speaker, I move that the following petition together with the report of the Parlia-mentary Joint Select Committee on Private Bills, which was presented on 15 December 2023, be now considered, namely the petition of Appleby (Bermuda) Limited for the Standard Crypto Insurance- Bitcoin (Bermuda) Limited, an exempted company incorporated in Bermuda on 3 June 2022, requesting the enactment of provisions to provide it with flexibility in structuring its long-term insurance policies as set out in the Bill originally entitled, “Standard Crypto Insurance- Bitcoin (Bermuda) Limited Act 2022,” since revised in the amended under the title “Meanwhile Insurance Bitcoin (Bermuda) Limited Act 2023.”
The SpeakerThe SpeakerAre there any objections? Agreed to.
Mr. Scott PearmanMr. Speaker, I move for leave to introduce and read for the first time by its title the following Private Bill entitled Meanwhile Insurance Bitcoin (Bermuda) Limited Act 2023.
Mr. Scott PearmanMr. Speaker, I move that the prayers of the petitioner be granted and to give effect thereto that without prejudice leave be granted to bring the proposed Bill reprinted to accord with the recom-mendations of the Parliamentary Joint Select Committee on Pri vate Bills for the amendment thereof.
The SpeakerThe SpeakerAny objections? Agreed to. The necessary certificates have been furnished. PRIVATE BILL FIRST READING MEANWHILE INSURANCE BITCOIN (BERMUDA) LIMITED ACT 2023
Mr. Scott PearmanMr. Speaker, the Private Bill is hereby read for the first time by its title only: Meanwhile Insurance Bitcoin (Bermuda) Limited Act 2023. STANDING ORDER 33(7)(a)
Mr. Scott PearmanMr. Speaker, I move that under the provisions of Standing Order 33(7)(a) the remaining stages of the said Private Bill be undertaken forthwith.
The SpeakerThe SpeakerAny objections? None. Agreed to. PRIVATE BILL SECOND READING MEANWHILE INSURANCE BITCOIN (BERMUDA) LIMITED ACT 2023
Mr. Scott PearmanMr. Speaker, I move that the said Private Bill be now read the second time in this House 320 15 December 2023 Official Hansard Report Bermuda House of Assembly by its title only: Meanwhile Insurance Bitcoin (Bermuda) Limited Act 2023.
The SpeakerThe SpeakerAre there any objections? Agreed to.
Mr. Scott PearmanMr. Speaker, I move that the clauses and preamble of the said Private Bill be approved.
The SpeakerThe SpeakerAny objections? Agreed. [Motion carried: Clauses and preamble approved.] PRIVATE BILL THIRD READING MEANWHILE INSURANCE BITCOIN (BERMUDA) LIMITED ACT 2023
Mr. Scott PearmanMr. Speaker, I move that the said Private Bill be now read for the third time in this House by its title only and passed: Meanwhile Insurance Bitcoin (Bermuda) Limited Act 2023.
The SpeakerThe SpeakerAny objections? None. Agreed. The said Private Bill has now passed. Thank you, MP Pearman. [Motion carried: The Private Bill, Meanwhile Insurance Bitcoin (Bermuda) Limited Act 2023 was read a third time and passed.]
The SpeakerThe SpeakerWe will now do the third readings of the Bills that were done earlier. The first one was the . . . the other is for consent, so, Premier, you can do your income tax and go down the order. SUSPENSION OF STANDING ORDER 21 Hon. E. David Burt: Thank …
We will now do the third readings of the Bills that were done earlier. The first one was the . . . the other is for consent, so, Premier, you can do your income tax and go down the order.
SUSPENSION OF STANDING ORDER 21 Hon. E. David Burt: Thank you, Mr. Speaker. Mr. Speaker, I move that Standing Order 21 be suspended to enable me to move the Bill entitled the Corporate Income Tax Act 2023 to now be read for the third time by its title only.
The SpeakerThe SpeakerAre there any objections? There are none. [Motion carried: Standing Order 21 suspended.] BILL THIRD READING CORPORATE INCOME TAX ACT 2023 Hon. E. David Burt: Thank you, Mr. Speaker. I move that the Bill entitled the Corporate Income Tax Act 2023 be now read for a third time by its …
The SpeakerThe SpeakerThe Bill has been read by its title only and is now passed. [Motion carried: The Corporate Income Tax Act 2023 was read a third time and passed.]
The SpeakerThe SpeakerThank you. The next one is the Bermuda Monetary Authority. SUSPENSION OF STANDING ORDER 21 Hon. Wayne L. Furbert: Mr. Speaker, I move that Standing Order 21 be suspended to enable me to move a Bill entitled the Bermuda Monetary Authority Amendment Act 2023 to now be read for the …
The SpeakerThe SpeakerAny objections? There are none. Proceed. [Motion carried: Standing Order 21 suspended.] BILL THIRD READING BERMUDA MONETARY AUTHORITY AMENDMENT ACT 2023 Hon. Wayne L. Furbert: Mr. Speaker, I move that the Bermuda Monetary Authority Amendment Act 2023 be now read for a third time by its title only and passed.
The SpeakerThe SpeakerThe Bill has been read by its title only and is now passed. [Motion carried: The Bermuda Monetary Authority Amendment Act 2023 was read a third time and passed.]
The SpeakerThe SpeakerThank you, Members , for your participation today.
Mr. Premier.
ADJOURNMENT
Hon. E. David BurtpremierThank you, Mr. Speaker. Bermuda House of Assembly Mr. Speaker, I move that this Honourable House do now adjourn until Friday, February 16, 2024. And I know there are Members who wish to speak.
The SpeakerThe SpeakerDoes any Member wish to speak? Opposition Leader, you have . . . wait a minute. Let me reset our clock. You have your 20 minutes. SEASON’S GREETINGS Hon. Jarion Richardson: Thank you, Mr. Speaker. I appreciate this opportunity to contribute during the motion to adjourn. Mr. Speaker, as we …
Does any Member wish to speak? Opposition Leader, you have . . . wait a minute. Let me reset our clock. You have your 20 minutes.
SEASON’S GREETINGS Hon. Jarion Richardson: Thank you, Mr. Speaker. I appreciate this opportunity to contribute during the motion to adjourn. Mr. Speaker, as we close out this year 2023 going into 2024, during this holiday season, we want to make sure that we wish everyone in this Honourable Chamber, their friends and family, the members of the public, the office staff of the Legislature, indeed everyone who has contributed to the successful governance in any given year a very merry Christmas and a very happy and prosperous New Year. Mr. Speaker, in this time of generosity, kindness and giving, we are very mindful that there are quite a few families who are dealing with calamities right now in Bermuda. They are dealing with the calam-ity of violent crime, they are dealing with the calamity of economic circumstances, they are dealing with calamity for any number of reasons. As we break for Christ-mas we want to remind members of the public, as well as ourselves, that we can extend kindness to one another over this season. For all those people in want and need, we desperately pray and hope that they can find some relief and some joy in this holiday season as the food lines get longer and more and more people are using the thrift stores and things like that. We definitely hope and pray for the success of all of our charities who are involved in the good work for this season. We know that the Salvation Army is out there but there are dozens more. In fact, Mr. Speaker, there are some 300, just under 300 registered charities. So, we would ask anyone with the time and means to make sure that they contribute some portion of their holiday time for giving towards others, especially, again, those in need. Mr. Speaker, again, we are incredibly grateful for all of the things we have been working on this year. We look forward to 2024. And again, I wish my honourable colleagues a very merry Christmas and a happy New Year.
The SpeakerThe SpeakerThank you, Opposition Leader. Does any other Member wish to make a contribution? MP Famous.
The SpeakerThe SpeakerSomething went wrong, there. Wait, wait, wait. Let’s clear that. [Laughter]
The SpeakerThe SpeakerI know you don’t need that. There you go. SEASON’S GREETINGS
Mr. Christopher FamousMr. Speaker, allow me to quote from what they call the Bible. Matthew 13:8. “Still other seed fell on good soil, where it produced a crop— a hundred, sixty or thirty times what was sown.” Mr. Speaker, last week, Sunday, December 10, Christ Anglican Church had their annual candlelight service. …
Mr. Speaker, allow me to quote from what they call the Bible. Matthew 13:8. “Still other seed fell on good soil, where it produced a crop— a hundred, sixty or thirty times what was sown.” Mr. Speaker, last week, Sunday, December 10, Christ Anglican Church had their annual candlelight service. They have this every year, that’s why it’s called annual. But this year they decided to honour some young men in the Devonshire community. The church was full, 275 people to be exact. People from both sides of the aisle were there. But more importantly, Mr. Speaker, there was this. Every year we go through this motion talking about merry Christmas and then come January we are right at each other’s thro ats again. Right? It seems kind of hypocritical at times. So this is what I would say to . . . well, there is nobody left on that side. This is what I would say to the Members in here. The church is not a building; the church is the people. The government is not this building; the government is the people. Right ? So, each of us should commit ourselves to sowing those s eeds into our communities, because the thing is, Mr. Speaker, there is nobody in our communities who sat up and listened to the last 12 hours of us debating these things. There is nobody who sits up and says , Oh, I wonder if these guys are going to hook at motion to adjourn. But these are the same people who each one of us who sits in here from Dockyard to St. David’s that says, Hey, I haven’t seen my MP in a while. Especially our seniors. They don’t need our turkeys not just at Christmastime, they need our attention all year round, Mr. Speaker. So I say to my colleagues in this last motion to adjourn for the year, take the time, the necessary time, to sow seeds in each of your constituencies, whether visiting a senior, taking a youth out somewhere they normally do not get to see, teach them some history, do something so your constituents know that you are not just here giving out Christmas turkeys, but you are here sowing seeds in your constituencies. With that, Mr. Speaker, I want to thank the Christ Anglican Church, as we call it in Devonshire, Devonshire Church, for taking the time sowing seeds in the young m an’s heart, taking the time for my 322 15 December 2023 Official Hansard Report
Bermuda House of Assembly colleagues who came out, and I wish everyone a good season and a better New Year. Thank you.
The SpeakerThe SpeakerThank you, MP Famous. Does any other Member wish to make a contribution? MP Swan. SEASON’S GREETINGS
Mr. Hubert (Kim) E. SwanYes, Mr. Speaker. Mr. Speaker, I would just like to follow on from MP Famous and take this opportunity to recognise that the Christmas spirit is upon us now, and to urge everyone in the community to do what they can to uphold that wonderful saying Be thy brother’s keeper. …
Yes, Mr. Speaker. Mr. Speaker, I would just like to follow on from MP Famous and take this opportunity to recognise that the Christmas spirit is upon us now, and to urge everyone in the community to do what they can to uphold that wonderful saying Be thy brother’s keeper. I have new appreciation for just how important that quote is. And I am minded that during these holiday times there are persons in our midst who are going through very difficult times, and many times in silence. And they do a great deal to conceal what may be on their mind, or troubling their heart. Certainly in Bermuda we all try our best, being one’s brother’s keeper, to do things for others during this holiday spirit and many do so and we are appreciative. But I certainly believe, Mr. Speaker, that in our midst globally and locally, because many of our family members are not necessarily in our immediate midst anymore, that we need to be mindful that our brothers and sisters, our family and friends may very well be in need of just an ear. And I was told some years ago that this time of year is the most difficult time for many persons. I am grateful to have received that type of infor-mation. I am very cognisant of that truism, so I am urging us all to know that the little things that we can do to our fellow Bermudians, to our family members near and far, sometimes can go a long way to be as beneficial as some of the material things that might do for others. So, with that, Mr. Speaker, I want to take this opportunity in particular to send special warm Christmas greetings to all of those wonderful people especially in St. George’s West, constituency 2, from Ferry Reach to Khyber Pass, Wellington Back Road to H idden Valley, all through the community. Anchorage Road, and Anchorage apartments. But, Mr. Speaker, most importantly throughout our country as well, from Somerset where the Cup will last only until August, to St. George’s where it will return home, I want everyone throughout this country to know that the greatest gift that God gave each and every one of us is the ability to love and experience love. Let us do whatever we can within our circles to spread that love on the Christmas season because it means more than a gift. It is the greatest gift. And I hope that there is more of it within Bermuda. I pray, Mr. Speaker, that we can go from this day forth to the New Year incident free. That would be a miracle that we can pray for, that we can hope for. We can hope that every family will have a blessed Christmas without any events that cause them distress or torment. To me, Mr. Speaker, that will mean more than any present under any tree, any day, any year. Let it be now. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThank you, MP Swan. MP Rabain. SEASON’S GREETINGS Hon. Diallo V. S. Rabain: Thank you, Mr. Speaker. Mr. Speaker, I just want to . . . I rise to my feet pretty much in the same vein as my colleagues who went before me. I just want to ensure that …
Thank you, MP Swan. MP Rabain.
SEASON’S GREETINGS
Hon. Diallo V. S. Rabain: Thank you, Mr. Speaker. Mr. Speaker, I just want to . . . I rise to my feet pretty much in the same vein as my colleagues who went before me. I just want to ensure that those out there who really need to hear it, understand and know that we are wishing them a very merry Christmas and a happy New Year, and season’s greetings. There is a family in my constituency that will not necessarily have a great Christmas, Mr. Speaker, as the shooting that happened on Monday was a family that lives in my constituency. One of the things, when you talk to the people and they ask you as they are trying to figure out, you know, what is the point of this violence. And you just have no answer. You really have no answer for them. So, I just want us as Bermudians to really get past what I think is becoming a numbing to some of this violence that w e are seeing in our Island. And understand that it is going to take all of us to reach out to these young men and women who are committing these awful acts of violence and have them understand that there are alternative ways to resolve conflict. You do not have to resort to violence to get your point across. I also want to say season’s greetings to all of my constituents. As we have heard there are some people in Bermuda who are doing a little bit better than others. Some are finding themselves in various levels of difficulty. But I want to let them know that we are praying for them and we are doing all that we can from these benches to make Bermuda a less harsh place than some believe it has become over the years. Things will get better, and they will progressively move towards a space where people can not feel as much pressure as some people are alluding to that they are feeling at this point. On another note, Mr. Speaker, I do want to send happy holidays to all of our hardworking educators out there. They are doing a yeoman’s job. Some of the unfair criticisms that they do get from some members of the public are unfortunate when it comes to th e tremendous job that they are doing of being there and, in some cases, Mr. Speaker, they are sometimes the most responsible adults that some of our children see on a daily basis. So that is beyond teaching. Your wife is an educator. I am sure you know exactly, you know, they go beyond just a curriculum more often than not in the classroom.
Bermuda House of Assembly These children go to school from 8:30 in the morning to 3:30 in the afternoon. They spend a lot of time with these individuals. So I just want to send a shout -out to all of our teachers and let them know that we over here at the Ministry, at the Education Reform Unit and the Department of Education send them our prayers over this holiday. Have a restful holiday. Come back next year rejuvenated to attack that profession that teaches all other professions, that, being a teacher. With that, I just wish my honourable colleagues in here a merry Christmas and a happy New Year as we go into 2024. Thank you.
The SpeakerThe SpeakerThank you, Minister. Does any other Member wish to make a contribution at this time? Premier . . . well, before you go, I am going to ask for the indulgence of the House. I am going to call on the Government Whip to do something that the Deputy Speaker …
Thank you, Minister. Does any other Member wish to make a contribution at this time? Premier . . . well, before you go, I am going to ask for the indulgence of the House. I am going to call on the Government Whip to do something that the Deputy Speaker normally loves to do at this time of the year. I am surprised he left without remembering it. But the Government Whip will do it in his stead. Government Whip.
Mr. Neville S. TyrrellMr. Speaker, thank you. I hope to do justice as the Deputy would have.
The SpeakerThe SpeakerYes. SUSPENSION OF STANDING ORDER 21
Mr. Neville S. TyrrellMr. Speaker, I move that Standing Order 21 be suspended to enable me to move that a message be sent to the Senate conveying Christmas and New Year’s greetings.
The SpeakerThe SpeakerSo moved. [Motion carried: Standing Order 21 suspended.] MESSAGE TO THE SENATE CHRISTMAS AND NEW YEAR’S GREETINGS
Mr. Neville S. TyrrellTo the Honourable the President and the Members of the Senate: The Speaker and the Members of the House of Assembly desire to extend to the President and Members of the Senate our greetings and best wishes for Christmas and the New Year. SUSPENSION OF STANDING ORDER 21
Mr. Neville S. TyrrellMr. Speaker, I move that Standing Order 21 be suspended to enable me to move that Christmas greetings and best wishes for the New Year be conveyed to His Honour the Speaker.
The SpeakerThe SpeakerThank you. [Motion carried: Standing Order 21 suspended.] MESSAGE TO THE SPEAKER CHRISTMAS AND NEW YEAR’S GREETINGS
Mr. Neville S. TyrrellI move that His Honour the Speaker be requested to accept Christmas greetings and best wishes for the New Year from the Members of the House of Assembly.
The SpeakerThe SpeakerWell, yes. SUSPENSION OF STANDING ORDER 21
Mr. Neville S. TyrrellMr. Speaker, I move that Standing Order 21 be suspended to enable me to move that Christmas greetings and best wishes for the New Year be conveyed to Her Excellency the Governor, Ms. Rena Lalgie.
The SpeakerThe SpeakerYes. [Motion carried: Standing Order 21 suspended.] MESSAGE TO THE GOVERNOR CHRISTMAS AND NEW YEAR’S GREETINGS
Mr. Neville S. TyrrellI move that his Honour the Speaker, be requested to convey to Her Excellency the Governor, Ms. Rena Lalgie, and her family, hearty Christmas greetings and best wishes for the New Year from the Speaker and the Members of the House of As-sembly. Thank you, Mr. Speaker.
The SpeakerThe SpeakerThe appropriate I documentation and notice of greetings will be sent. Thank you, Government Whip. Does any other Member [wish to speak] before the Premier? The Premier is on his feet. Premier, you have your 20 minutes. Hon. E. David Burt: Mr. Speaker, I think I am going to use …
The SpeakerThe SpeakerI know you’re tired from all of the talking that you have done. SEASON’S GREETINGS Hon. E. David Burt: It has been a long day. It has been a long week. It has been a long year for many. But I want to start where the Honourable Minister of Education …
I know you’re tired from all of the talking that you have done.
SEASON’S GREETINGS Hon. E. David Burt: It has been a long day. It has been a long week. It has been a long year for many. But I want to start where the Honourable Minister of Education left off. 324 15 December 2023 Official Hansard Report
Bermuda House of Assembly I was not here during congratulatory and/or obituary speeches, so I just wish to . . . you know, it is tragic to see a person’s life taken by guns. And we recognise and we understand that the particular circumstances of this has heightened our tension. And we know that the emergency services, the police service, the Ministry of National Security, the prevention teams are doing what they can to best as possible limit any further action. But what I would say, Mr. Speaker, is that as this is the time where tr aditionally we thank all of the persons who serve, I want to thank the uniformed services and the emergency services, but also especially, Mr. Speaker, the helping agencies. The ones who may not be on the front line, but the ones who are helping when it co mes to counselling and trauma and after the impact whether it is those within the Government, the Ministry of National Security, or those within the private sector. Also, Mr. Speaker, it is important at this time to remember the charitable sector, to remember all of the various items that the charitable sector does, not just during the holiday season but during all times of the year. I think that it is important that we recognise and understand that many of us engage in charitable events during this time of the year. But it is also important that we engage in those type of events at all times during the year to remember those persons who may be less fortunate. So, Mr. Speaker, my hope and prayer is for those persons who have experienced loss this year . We know that there are some of our honourable fellow Members here in this Chamber [who have experienced loss]. And many of those who are inside of our various constituencies that we do recognise and understand and keep them in our thoughts, especially around this time at Christmas. The reminder is always to look out for those who are less fortunate. And I think by and large our community does a good job of that. But it is never too much to think about going to extra mile to help and to assist in another way possible. So, Mr. Speaker, the day has been long. The year has been long. Progress has been made. But we will come back in February to continue to advance the interests of our people in a new year . So, on behalf of the Government, on behalf of the Cabinet, on behalf of the Progressive Labour Party, I wish you, Mr. Speaker, I wish the hardworking staff here at the House of Assembly, I wish all of the hardworking public officers throughout this count ry and all of the hardworking men and women of this country, our young people and our senior citizens a very happy and healthy Christmas season. May it be peaceful, may it be blessed. And for those of us who serve with me in Cabinet and for those of us who serve within the Ministry of Finance and other places my directive i s to make sure you take time to get some rest. And that applies to you as well, Mr. Speaker, and all of the members up here who are working very hard. With that, Mr. Speaker, I thank you, and I hope that you have a merry Christmas.
SEASON’S GREETINGS
The SpeakerThe SpeakerThank you, Mr. Premier. Thank you, Members for your contribution today and throughout this session. Let me just take care of a little bit of housekeeping before I make my final comments. The house-keeping being that at the beginning of each session we normally name all of these committees and …
Thank you, Mr. Premier. Thank you, Members for your contribution today and throughout this session. Let me just take care of a little bit of housekeeping before I make my final comments. The house-keeping being that at the beginning of each session we normally name all of these committees and the changes to committees. That was not done as I was off the Island during that time. But the new committees will be up on our website next week, so Members can take a look at that and the public can see it as well. The housekeeping having been done, let me first thank those, particularly the Deputy Speaker who stood in my stead while I was off the Island, and thank Members for conducting yourselves, as we expect you to conduct yourselves whether I am here or not. I would also like to thank those in this Chamber and those in the listening audience who sent many well wishes and prayers for the time I was off the Island with a family medical situation. I thank you. We deeply appreciate those thoughts and those prayer s that were expressed by not only yourselves but those outside in the listening audience, as I have already said. As we now stand here on the eve of the Christmas holiday and break, as we take time to spend Christmas with our family and friends and we all speak about how we look forward to this time of the year just to be able to spend that extra love and closeness w ith our families, I want to challenge us to consider outside of our shores and what is going on in other parts of the world. I am going to quote from Martin Luther King, [Jr.] who said, “Injustice anywhere is a threat to justice everywhere.” Dr. King’s words dispose the notion that only the people directly affected by any sort of injustice can protest against it. He reasons that as human beings we are all tied to one another and whatever affects one community has the potential of affecting al l. And I say that in this context, as we take time to celebrate this Christmas season, let us be mindful of the unjust wars that are taking place around the world today. And I stress the unjust part about it. And that the unjust wars need to be brought to an end. There are lives . . . just like we live, there are fathers, mothers, children, grandmothers, grandparents who are being affected by this loss of life and just daily living. As we sit here on these shores in this Christmas period and enjoy the peace that Bermuda offers us, let us not forget the injustice that is being done in other parts of the world in these unjust wars that are taking place. Let us pray for those people, that this time of year will bring a cease fire to all of those unjust wars because it has gone beyond any justification of what’s taking place.
Bermuda House of Assembly I thank you. Enjoy the holiday. And we look forward to being back here in February.
[At 9:38 pm, the House stood adjourned until 10:00 am Friday, February 16, 2024.]