Can you imagine paying tax for the air you breath! Believe it or not, this does exist! More than that, in many countries, people pay more than 50% of their income to the government. I was told, in Britain’s case, birth certificates state that the child is property of the Queen, and that people pay taxes to her in order to live in her land. In the case of Japan, businessmen don’t believe that countries exist today where people don’t pay taxes. It is like food, every human eats it.
Well, before you start arguing that governments need money in order to spend it back to the citizens, hear this. There is no government that exist today which uses 100% of the money it collects for services to its citizens. In fact, the number is not even close to 100%, because the best of governments can’t even reach 90%. India, the world’s largest democracy, uses less than 5% of the money it collects via taxes for services! Many, many governments, or nearly all, are not spending wisely the money they collect from their citizens, which is a major factor why a large number of American businessmen are forfeiting their citizenship and, on paper, migrating to another country, where they pay less, much less taxes.
Then comes Bahrain, our lovely Island, which has the number 1 tax regime in the world. We really do absolutely have a 0 next to all types of taxes, corporate, income, turnover, asset, and all others. What this has done is attract not just businesses, but even businessmen to migrate and enjoy living in a country voted as the 22nd best place to live in from around the world.
Still, those who are not Bahrainis always ask, how does the government make money? How does it pay for all this free stuff that citizens get like housing, healthcare, education, and subsidized food, electricity, and even oil? Honestly, that’s a good question.
You see, out of the money made in Bahrain, AKA GDP, oil is only around 13%, which means that 87% of the money made in Bahrain is not related to oil. However, around 80% of the money spent by the government is from oil, which means that the government is utilizing only 20% of that 87% money made in Bahrain. Not to confuse you more, basically, this is bad compared to all the developed economies. The developed economies find ways to tap into, or utilize, close to 100% of their GDP. In a nutshell, we have around 70% of wealth made in Bahrain running around untouched and making use of our free and subsidized services. Why do we allow this? Simply because we have oil. Can we remain dependent on oil? The short answer is not for long.
I personally don’t see Bahrain turning into any European country, where many of their citizens, believe it or not, consider themselves slaves to the government by paying more than 50% of the money they make. I don’t see Bahrain turning to the extreme towards Washington, D.C. where people pay taxes but have absolutely no representation in government. I see Bahrain, and a must, slightly finding ways to tap into the 70% wealth that is benefiting a lot from this lovely Island with paying only a minimal in return, which is a bit unfair.
Oil won’t be there for us forever, we need to find ways to balance ourselves without it’s assistance, because this is simply the future. For now, I’d say I Love You Oil, but it is best for us to see our own ways in the future.