Thursday, February 22, 2018

Importer defends rising food prices amid VAT removal

Food importers and distributors yesterday defended rising food prices even as they sought to finalise the November 15 Value Added Tax removal on some 7,000 food items. At a Ministry of Legal Affairs public consultation on rising food prices, president of the Food Distributors Association (FDA), Marc Mouttet, defended increasing prices at the import level.

The consultation was at Capital Plaza on Wrightson Road, Port of Spain yesterday.

"There are more people to feed globally and international prices are going up. The removal of VAT is an initiative to alleviate the increase in food prices, but the cost will rise as they will," Mouttet said yesterday.

"I hope the consumer is not led to believe that come November 15 there is going to be a 15 percent reduction in their food bill because that is an inaccuracy that I would like to address here right now," he said.

Mouttet said even though the Government has not yet made the list available to them, several hundred items are already VAT free in the supermarket.

"So they would not be, on November 15, a reduction on those items and that is something that we need to understand," he said.

Mouttet said the food distributors were committed to the Government budget promise and would take VAT off as soon as the list was released to them.

"We support the initiative and as soon as we see that list we will take the VAT off," he said.

Supermarket Dealers Association of Trinidad and Tobago (SDATT) president Vernon Persad, yesterday described the upcoming price changeover as "herculean", saying that hours between the close of business on November 14 and open doors the next day are sure to be very busy ones.

"We are hoping to have "was and now" stickers to show which items had the VAT removed," he said.

The two men clashed though as Persad was not supportive of the speed at which importers increased their prices to retailers. Persad said he will continue to refuse to stock some suppliers, describing their increased prices as "abnormal".

"It was not the increase, it is the velocity and amount from various suppliers at one time. That is what is abnormal," Persad said.

Former SDATT president Balliram Maharaj however expressed some concern over the rapidly approaching deadline and called for more involvement from the Customs and Excise division and the VAT office. Maharaj said his concern stemmed from the mid-month deadline and questioned who would absorb the VAT he would pay in items imported before the VAT removal deadline date, but sold after.

"I think it will take about a month to get Customs to remove VAT on the imports, so I believe the announcement could be made on November 15, but think it will be better implemented on December 1," he said.