VAT complaints

11.MAY.07

As is expected, the introduction of the Value Added Tax (VAT) from May 1, 2007 has been the subject of heated discussion. The airwaves are virtually saturated with complaints about the VAT and you can hardly hold a conversation now without VAT rearing its head. It has even become an addition to the stock of butt jokes for which we are so famous in the Caribbean.{{more}}

To make matters worse there was the public admission by the head of the VAT unit that there is precious little they can do to control prices since the mark-up is the prerogative of the sellers. Perhaps encouraged by this, some merchants have been unscrupulously trying to exploit the situation and bleed consumers in the process. With the transitional phase and the novelty of VAT, there is room for profiteering.

So the complaints rain thick and fast and inevitably the government is taking a lot of flak. The weaknesses in price control are being cruelly exposed. Interestingly, just as we moan about the need for real price control, out comes word that the International Monetary Fund (IMF), is recommending to Caribbean governments that they abandon that practice. The political responses to this are awaited.

However, there is one element of the whole VAT row which needs examination. That is, consumer responsibility. For nigh, on a year now we have known of the introduction of VAT, how many of us have attended consultations or read publications? Have we been carefully examining the published material indicating which items should be cheaper under VAT and which prices should raise?

Our own failure to seek proper information has led to a wide misconception, that VAT is an additional tax, rather than a replacement for the consumption tax. That is clear from the many calls on radio and day-to-day prouncements by people. The VAT unit and Government must also understand that the public awareness campaign must continue.

Finally, the solution to our many problems with VAT and with greedy merchants lies in consumer organization. There is supposed to be a Consumers Association here, but have we as aggrieved consumers contacted it, enrolled in its membership and tried to encourage others to do so do build a strong People’s Movement to protect consumers interests? That, we would dare suggest is certainly one way to go.