Government warns against price gouging

GINA, GUYANA, Monday, January, 30, 2017

The government side of the House voted down a motion to restore zero rated Value Added Tax (VAT) items today in the National Assembly.

The Opposition motion called on the government to repeal the amendments to the Value Added Tax (Amendment of Schedules) Order No 18 of 2016 and reinstate the existing prior order.

However, Minister within the Ministry of Finance, Jaipaul Sharma, clarified that zero rated and exempted items do not attract VAT. “What is important is these measures benefit business people,” Sharma argued. He said the new measures allow for easier and effective refunding systems for both businesses and the Guyana Revenue Authority (GRA).

Minister Sharma cautioned that measures would have to be taken to ensure that businesses do not take advantage of consumers through price gouging.  “GRA may have to monitor and may have to sanction persons” who inflate prices for the protection of consumers, Minister Sharma said.

Additionally, there is access to the full list of items on GRA’s website. “The poor people should not be fearful,” Sharma assured. The Minister called the opposition’s arguments “irresponsible distortions”.

Finance Minister, Winston Jordan, explained that the new measures are aimed to make the VAT relevant. The Minister noted that the previous VAT regime netted excessive revenues in its initial implementation, reaching 30.4 per cent in 2008. The VAT regressed to 24.8 per cent thereafter.

Jordan noted that while the new VAT measures were part of fulfilling a manifesto promises, the new measures also sought to strengthen the VAT system. The decline in the collection included policy measures which weakened the VAT regime, Minister Jordan said this had implications not only for tax payers but for the government.

Repeating arguments made during the budget debates and after, members on both sides of the House argued over the motion to restore zero rated VAT items. It was brought by Opposition Chief Whip Gail Teixeira. “This is a matter of great importance of the Guyanese people that want to know…why you’ve taken items that were zero rated and exempted them,” the Opposition Chief Whip said.

The Finance Ministers were the only speakers on the motion for the government side of the House. Four other opposition members debated along the same line as they called for the reinstatement of the zero-rated items. Those were Sheila Veerasammy, Neil Kumar, Yvonne Pearson and Frank Anthony.

Meanwhile, Minister of Finance, Winston Jordan, in concluding the debates called the motion a “crocodile” to distract the House from other pressing business. The exhaustive discussion on the motion was dealt with during budget debates and passage of legislation to support the new measures, the Minister pointed out.

By: Tiffny Rhodius