The Bahamas-based think tank, the Nassau Institute, says recent tax rises and other related measures introduced by the jurisdiction will deter investment and actually cut, rather than increase, revenues.

“For starters, a government should not be destabilising the business community with excessive taxation nor blindsiding them with rule/regulation changes that do not seem to be well thought out. Despite this, the Bahamas economy has certainly had an abundance of new taxation and regulation in recent months,” according to the institute in a recent article.

In the 2010 budget, Hubert Ingraham, prime minister of the Bahamas, announced hikes to licence fees and taxes across the board, along with measures to bolster tax collection and compliance. Measures include a rise in stamp taxes on bank and property transactions, rises in travel and hotel room taxes, and fee rises under the International Companies Act.

The Nassau Institute describes itself as "an independent, a-political, non-profit institute that promotes economic growth in a free market economy with limited government, in a society that embraces the rule of law and the right to private property".

The institute did not respond to this publication's request for comment at the time of going to press.