Pain, confusion at VAT rollout

Fri, Jan 2nd 2015, 12:43 AM

The rollout of value-added tax (VAT) yesterday pained some consumers and confused others.
The immediate effects were felt in food stores, telecommunication services and restaurants.
But major gas stations on New Providence visited by The Guardian were not charging VAT on gasoline.
The Guardian visited two Shell stations, a Rubis station and two Esso stations.
A customer at a Shell station said he was relieved not to pay VAT on his gas.
According to a source from the Bahamas Petroleum Retailers Association, members were conflicted between the law regulating fuel and the VAT law, which may have resulted in VAT not being charged.
However, the source said the owners had agreed that they should charge VAT.
When contacted yesterday, Minister of State for Finance Michael Halkitis said the VAT Compliance Unit will investigate the matter today.
Halkitis said VAT should be applied to gasoline.
He also noted that Super Value reported that it had a computer problem yesterday.
When asked if that resulted in the grocery store chain not charging VAT, Halkitis said when the VAT Unit went to investigate the stores had closed.
He said the VAT Unit will also follow up with that issue today.
Super Value owner Rupert Roberts could not be reached yesterday.
Halkitis said because yesterday was a holiday there weren't too many issues.
"So far everything has been smooth," he said.
"We don't expect many issues."
VAT was implemented, in some cases, at midnight, yesterday at a rate of 7.5 percent. The government had originally proposed to implement the tax at 15 percent.
In Solomon's Fresh Market in the Harbour Bay Shopping Centre, some items were displayed with a VAT-inclusive price.
For instance, a gallon of milk had the VAT-inclusive price of $8.69.
Yesterday, some customers were heavily scrutinizing items. One man was frozen in place for at least five minutes as he gazed at the prices.
"This is some crap," he said.
Another customer, Donnaveo Sherman, who was with his little girl, told The Guardian that the new prices are ridiculous.
"Prices were already high, but they're ridiculous now," he said.
"They actually give you the price and they show you the total on it. The stuff I got came up to $28 and that's only four items.
"It's still a lot of money. The prices were already high, so I was shopping with VAT in mind even before VAT was implemented.
"Everything is almost close to $10. It's ridiculous because if you look at it as the weeks will progress you will probably see [fewer] and [fewer] people even buying from here.
"They (the government) are starting at 7.5 percent and it was supposed to be 15 percent.
"How in the world are you supposed to even get to 15 percent if we can't even deal with this? Imagine 15 percent of what this stuff is already."
Another woman, who did not wish to be identified, said she will not shop as frequently as she used to.
At Xtra Value on Carter Street customers were also studying prices.
A cashier told a customer that she had forgotten to add the VAT price and quickly added the 38 cents to that customer's total.
"You get what you voted for and we voted for the Progressive Liberal Party," a customer named Roger told The Guardian.
"That fellow, [Marco City MP] Greg Moss, he was right. This will hurt the poor man."
One lady, who wished only to be identified as Emily, said she paid $1.30 for VAT on her items from the store.
"I didn't pay it [any] mind," she said. "It wasn't that significant and to be honest, we all knew it was coming."
At Golden Shore Chinese restaurant on Farrington Road, Julian Brown, who bought a dinner, said he didn't care about VAT.
"It wasn't any difference," he said.
"I pay $7 normally and just now I paid $7.50. I really didn't feel any difference."
But some were not so agreeable. Kristina Mott said prices are already high.
"The only thing that isn't going up are salaries," Mott said. "One bottle of Guinness cost almost $3 and that's without VAT. So we don't need VAT right now."
There were also concerns about VAT on mobile services.
Customers took to the Bahamas Telecommunication Company's (BTC) Facebook page to protest the increase of phone cards or top up at gas stations.
BTC explained, "This was a test by an employee of a gas station and is not what the public should be charged when purchasing top up or phone cards."
Yesterday, a roadside vendor was selling phone cards at face value.
According to BTC, phone cards or top up will not increase in price but VAT will be applied to every phone call, text message and on new data plans.
"VAT will be charged per minute, per text message, per data plan used," BTC said.

Click here to read more at The Nassau Guardian

 Sponsored Ads