The Inland Revenue Department and the Ministry of Trade are asking persons to be vigilant to ensure that the increase in Value Added Tax (VAT) is reflective of the one per cent rise and no more.
Comptroller of the Inland Revenue Department Kelvin Pompey, in a recent interview with SEARCHLIGHT, said that it is likely that situations will arise where prices are increased beyond the one per cent.
The increase in the VAT from 15 per cent to 16 per cent took effect on Monday, May 1 and Pompey said that he believes that some persons will take the opportunity to raise the prices of the VAT commodities higher that they should be.
He promised, however, to have personnel from the VAT Unit and the Ministry of Trade in the field to monitor the transition.
âThe departments would have to be vigilant and our people would be basically out the first week of May to make sure that prices are reflective of just the one per cent increase,â promised Pompey, who added that there are laws related to price gouging.
He said that while the VAT Unit and the Ministry of Trade realize that there are different cost structures to businesses, persons must be fair to consumers. He, however, noted that at times, competition sorts out the problem.
ââ¦sometimes it is hard for the Ministry of Trade to tell somebody that they should not be selling their product for .24 cents over or .50 cents over, because their cost structure may be different from another person, but I think, generally, what happens in situations like these is that you would find that if one or two businesses try to push their cost up, others who donât do it would pull the price back down to what is considered normal,â said Pompey.
He said that he is hoping that demand and supply and the openness of our economy would make businesses price their products to profit off the increase in VAT.