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Greater Tunapuna Chamber concerned about VAT changes

Tuesday, January 26, 2016

President of the Greater Tunapuna Chamber of Industry and Commerce David Edwards has expressed concern about the impact of the reduction of value added tax (VAT) to 12.5 per cent and removal of the zero rate of certain food items and other commodities. 

In a statement yesterday he said: “The reduction was part of a strategy to collect more taxes to meet the $21.5 billion deficit as disclosed by the Minister of Finance in his 2015/16 Budget presentation. At that time questions were raised about the ability of this move to raise the anticipated $4.5 billion, but it has become painfully clear to all by the subsequent move made to remove from zero rate several food items and moreso certain books and computers.”

Edwards said the impact of the measures would be felt in households, adding to the effects of the recession in T&T.

He also expressed concern about impact on the business community of the increase of the Business Levy from 0.2 per cent to 0.6 per cent and Green Fund from 0.1 per cent to 0.3 per cent. He said businesses will be challenged in their efforts to “pursue a growth path without negatively affecting labour or other variable costs as the situation may demand.” 

“At this time when confidence needs to be the order of the day and optimism a watch word businesses will find themselves hard to meet all these demands and yet resist the urge, if not the demand, to keep the bottom line positive as in previous years. Investment opportunities and the funds to support these initiatives will play a crucial part in how businesses cope in the next year to two,” he said.