VAT implementation…
Consumers under siege from dishonest businesses, appeal for quick solution
By Melanie Allicock
Kaieteur News
January 5, 2007

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As VAT implementation continues, consumers are becoming more frustrated with the unscrupulous actions of many businesses and are calling for a hasty solution to the situation.

Many opine that while the Guyana Revenue Authority (GRA) has begun taking action in dealing with these discrepancies, the actions have not been far reaching enough to effect change to the majority of businesses.

Despite the continuous outreaches by the GRA and Consumer Department of the Ministry of Trade and Tourism to monitor and ensure the correct application of the new tax, a large number of businesses continue to default.

On a tour of the city yesterday, it was found that while more registration certificates are now prominently displayed in business entities, others are without, but are charging the VAT.

This is especially so in the case of the smaller businesses and vendors, many of whom do not qualify for registration since they do not turnover $10M annually.

When it was pointed out to them that their practice was inconsistent with the new tax act, the majority of them related that they were now accessing their commodities for sale at increased prices.

“Tell them wholesalers that we buying from about the inconsistency; don't tell we cause is everything raise. When we go to buy goods, things that we didn't expect to raise and that the GRA said wouldn't go up had VAT added on to them. So that 16% got to be passed down,” one vegetable vendor posited curtly.

Another boldly stated that while she was a vendor, she was also a consumer and since she was now paying more for almost every commodity, she had raised the prices of her goods to offset the additional expenses.

Yesterday, consumers were forthright in their lamentations about the hardships being endured as a result of the new system.

Sharon Smith, a housewife from the East Bank, opined that the VAT has hit Guyanese like a ton of bricks and is not doing what it had promised.

“It is not that we don't want to pay VAT. People were gearing their minds to it since last year, but the ads said that while some items would go up others would be reduced to provide balance. That is not so.”

She is of the view that no amount of outreach activities by the authorities could effectively curtail the unscrupulous acts of some businessmen. This, she said, means that consumers will continue to suffer for a significant amount of time in the future.

“The GRA and the Ministry just don't have the amount of human resources to check on everybody. They will check on the big businesses but the smaller community shops doing their own thing and they can't travel the length and breadth of Guyana checking on all of them. Besides, even if they do reach them and the businesses adjust their attitude, by the time the officials leave they could resort to the old ways. As far as I am concerned, VAT signaled the beginning of perilous times for consumers and it ain't gon change.”

Twenty-nine-year-old Shondell Williams was the picture of utter frustration when Kaieteur News caught up with her in the city yesterday, clutching a set of bills trying to make some sense of it.

She related that she was a mother of six and a single parent, her husband having been shot dead by the police a few years ago.

She lamented that she visited the city with the intention of purchasing school clothing for her charges but was unable to do so fully because of the increased prices.

“I going mad… I barely get a $10,000 and come to town to finish buying me children clothes so that they could start school. I write a list of 11 items and was only able to get 7 things on the list. Everywhere I go people adding on VAT. What I gon do now. School start since Monday and they ain't go yet. I want me children to go to school,” the mother lamented.

Beatrice John, a 76-year-old pensioner, was close to tears in Bourda Market yesterday.

According to her, she went with a ‘li'l small piece' to the market to try to get her regular fortnightly foodstuff but could only afford a portion of them.

“I don't buy fancy clothes and all dem things. When I get the li'l pension all I does want is to buy food to eat. Now every single thing gone up due to VAT. Everyday the cost of living going up. God could tek me now; I fed up. I live too long to punish so,” the pensioner said with tears in her eyes.

The general observation on the street is that while the cost of living seems to have risen dramatically in the last few days, salaries remain fixed.

“Government know this tax was coming and things will go up, but didn't even award an increase to public servants last year,” one woman remarked.

It was also noted yesterday that a few stores with branches had taken to photocopying the registration certificates to give to its other outlets.

According to Commissioner General Kurshid Sattaur, this is illegal and persons have been advised to visit the GRA office to access copies of the original.

Officials from the GRA have intensified their efforts in monitoring the implementation of the VAT in the wake of the reports of improper practices at many businesses.

The major glitch seems to be price gouging, since persons have taken to raising prices in an ad hoc manner, either specifically claiming it due to VAT, or suggesting so.

Persons related yesterday that their rents had been raised. Others claimed that they had paid increased taxi and bus fares.

Simon Anderson, a father of three probably summed it up best when he said “Something got to be done about this VAT thing and quick. The country was getting stabilised, but if government don't control this thing it could change this scenario. This is a bread and butter issue and people are frustrated and need to be appeased or things will explode in this country. People just can't afford to pay VAT in the way it is being implemented.”