The Progressive Labour Party has proved that it is a “tax and spend” Government after the release of a controversial tax report on Monday which showed it is looking at raising taxes, according to Opposition Leader Grant Gibbons.

The “Report on the Bermuda Tax System” in 1997 was released on Monday by Minister of Finance Paula Cox who said Government was looking at raising taxes by between two and three percent - but would not bring in income tax.

Dr. Gibbons said that the revelations show that PLP Government was in effect looking to raise between $74 million and $110 million in taxes.

“That would translate in to roughly doubling or tripling land tax at the current rate or a 50 percent increase in payroll tax,” said Dr. Gibbons.

“That two to three percent of gross domestic product translates to additional tax burden on the community.

“So it is a huge increase. It essentially proves that this is a tax and spend Government which is extremely comfortable with higher tax rates.”

Dr. Gibbons also revealed that the long-awaited and controversial 150-page document had not changed much since it was commissioned by the United Bermuda Party when he was Finance Minister.

But he said that the parameters were changed when the PLP when it asked the consultants to look at increasing the taxes to 24 percent of GDP.

Ms Cox said the tax rate currently stood at 18 percent and the Government would like to see taxes at between 20 and 21 percent of GDP, a rise of between two and three percent, but did not intend to go all the way to 24 percent.

Dr. Gibbons was critical of the Government for not publishing the document until five years after it was ready, and said that much of the information was now out of date.

“I think first of all have to appreciate it is at this point almost a historical document,” he said. “It has been almost a decade since the document was commissioned and the economy has changed quite a bit since 1997/98.

“At that point international business was about 1.5 times the contribution of tourism. Currently international business is about three times of that of tourism and we have lost over $400 million dollars of visitor spending.”

He said that some of the conclusions reached in the review need to be updated, and what it was important for the public to know whether the Government supports the recommendations of the report or not.

“It is not clear from the Minister's comments,” he said and called on Ms Cox to clear up the matter.

He said that the document made “very clear” the differences between the former UBP Government and the new PLP Government because he said that in early 1999 “before the PLP had the chance to run govt, they were already seeking to get more money out of the taxpayer through higher taxes”.

And he said this was in contrast to the UBP pre-1998 “when we made it clear that we were not looking to change the amount of tax which was extracted from the community”.

The long-awaited Report on the Bermuda Tax System by Harry Gutman and Eric Toder was originally commissioned in 1997 by the United Bermuda Party, but it did not release the report before the general election because it was such a sensitive document.

Then when the Progressive Labour Partly swept to power, the authors of the report were asked to “improve the progressivity of the overall system of taxation” (which means finding a way getting those with higher income to pay higher taxes, and those with lower incomes to pay lower taxes) as well as increasing tax revenues to 24 percent of gross domestic product.

The report states that Government could raise and additional $54.3 million or 2.1 percent of GDP at 1999/2000 prices, with recommendations that could be implemented together or separately.

The 150-page document has been shrouded in secrecy until yesterday, and both the UBP and PLP members of Parliament have called for it to be made public.