VAT: Lowering consumer costs is the highest priority
Stabroek News
January 19, 2007
Although the government had said prior to the implementation of Value Added Tax (VAT) that the initial phase of the exercise was unlikely to pass without some hiccups, one wonders whether even the Guyana Revenue Authority (GRA) had anticipated the widespread and animated public response and the level of general concern that has ensued.
And while the GRA is entirely correct in its determination that the implementation of VAT will not be derailed by illegal practices one cannot help but wonder whether its reaction to those hiccups which it knew would arise is doing the cause of the new tax measures any good.
Over the past week or so the Commissioner General has found himself embroiled in public exchanges with the Georgetown Chamber of Commerce and the Private Sector Commission over whose fault it is that the hiccups have arisen and the resulting threats and "bad mouthing" may well have soured the already uneasy relationship between the government and the private sector.
While sections of the business community have been expressing their own concerns over various issues, particularly the "stock in hand" issue, it is clear that the greater concerns revolve around the impact of VAT on ordinary, and, in most cases, cash-strapped end consumers. Not even the government can deny that there has been a significant retail price increase in a range of consumer goods since January 2 this year.
Whether these increases have resulted from the legitimate application of VAT, from the misapplication of the new tax or simply from dishonest business practices is entirely beside the point. The fact is that prices have increased, the cost of living has risen and ordinary consumers are simply unable to cope.
In these circumstances the government's first obligation is to do what it can to ease the burden on ordinary consumers and while President Bharrat Jagdeo is on record as saying that the existing VAT measures will be revisited the situation has become sufficiently difficult for government to move with great haste to put relief measures in place.
Meanwhile, we can surely do with less of the acrimonious public discourse between the GRA and the public sector. Surely, they can bring to bear more of the pre-VAT collaboration and consultations that were being so highly touted by both sides prior to January 2007.