St. Kitts – Nevis Removes Tax On Some Food Items

Basseterre, Saint Kitts – Nevis
April 8, 2008 (CUOPM)

Consumers in St. Kitts and Nevis will now be paying less for 10 items ranging from canned foods to corn flakes and pampers.

The St. Kitts – Nevis Government on Monday ordered the removal of consumption tax to reduce the cost of living on several food items and pampers.

Minister of State for Information, Sen. the Hon. Nigel Carty said Cabinet removed the consumption tax on chicken, cheese, pasta, canned corn beef, Raisin bran corn flakes, sardines, soyabean oil, tinned tuna, Vienna sausage, margarine, tomato ketchup and diapers for babies and adults.

“The consumption tax usually applied to these products ranges from 15% to 22.5%, hence the removal of the consumption tax will yield significant savings for consumers. Some of these items will also very shortly be subjected to a further reduction in price through the removal of another tax called the CET or the Common External Tariff,” said Minister Carty.

He said the items listed above have been selected because they are among the commodities most frequently imported from St. Eustatius by local consumers.

Minister Carty pointed out that the Ministry of Commerce and Consumer Affairs has been charged with the task of vigorously monitoring these price control mechanisms to ensure that the benefits fall directly to the consumers rather than to businesses.

“Price control laws will also shortly be updated to support these objectives. The ministry has recently employed additional staff to carry out its improved programme of price control,” said Minister Carty, in a statement following the Cabinet Meeting.

He pointed out that over the last six meetings of the Cabinet,  chaired by Prime Minister Douglas, “very heavy and consistent focus has been placed on the high cost of living and deriving solutions to cushion the impact of the global phenomenon driven by the spiraling cost of fuel and the increasing demand for feedstock.”

The public would recall that towards the end of 2007, the Labour Government implemented a basket of goods whose prices are now regulated.

These goods include basic food items, basic medicine for chronic diseases, basic hygiene items and other non-food items. Under the regulation mechanism, limits have been imposed on the margins of profit that retailers and wholesalers can apply to the listed products.

Cabinet also reflected on and discussed the policies that have been implemented to shield consumers from the direct impact of the high cost of electricity. For in excess of one year, persons consuming less that 150Kwh of electricity are not required to pay the fuel surcharge. Recently, a new policy that caps the amount of the fuel surcharge at a maximum of 50% of the base charge has been implemented and this is anticipated to bring tremendous relief to consumers even as the price of fuel continues to increase.

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