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Vat Inclusive Price Concerns Are ‘Eased’

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A leading retailer yesterday said concerns over the Value-Added Tax (VAT) ‘inclusive pricing’ transition had been “resolved”, while urging the Government to prevent “chaos” by allowing period accounting to continue.

Rupert Roberts, Super Value’s owner and president, told Tribune Business that retailers would no longer have to pull off ‘a magic trick’ by switching to VAT ‘inclusive pricing’ overnight.

To further accommodate retailers and wholesalers with large inventories, and which might find it difficult to comply even in the two-month transition period that closes at end-February 2015, Mr Roberts said the Government would allow companies to show VAT ‘inclusive pricing’ in the shelf grooves.

“We’ve resolved it,” Mr Roberts told Tribune Business. “It’s not as satisfactory as to not have it made it inclusive, and stick to the old accounting and add it to the tape.

“We previously didn’t know how to handle that. There was no way in the future that you could say ‘Abracadabra’ and everything would be priced overnight.

“You can’t scan half a store, and can’t have half added to the tape and half isn’t.”

The Government, in its latest VAT ‘guidance notes’, promises that retailers will “not be penalised” during the two-month pricing transition if they display signs; have stickers and signs “immediately adjacent” to the goods on sale; and provide leaflets and printed materials which show, or list, the ‘inclusive prices’.

“If what they say stands, we’ll work with what they say,” Mr Roberts told Tribune Business. “I hope it remains. If they change it, I don’t know. We won’t be able to cope.”

He added that Super Value representatives were attending every VAT accounting training session and, once these workshops were completed, the supermarket chain would “discuss how we implement and do it satisfactorily”.

Confirming that Super Value had registered as a VAT payer, Mr Roberts said it was vital the company was allowed to maintain its existing ‘period’ accounting and bookkeeping practices.

He explained that the monthly comparisons this provided were vital to controlling the business, especially given the relatively thin margins that the grocery industry operates on.

“They do it monthly,” Mr Roberts said of VAT calculations and remittances, “but many people do period accounting. It will be chaos for them to say no, you can’t do that.

“If they throw our accounting into chaos, we can’t comply with the 30-day deadline to turn over VAT in. We hope to be ahead of their schedule if they leave us with period accounting, as we will pay before or by the end of the month.

“It’s their [the Government’s] money, and as fast as we collect it we are prepared to give it to them.”

Explaining that Super Value would incur extra costs and have to conduct more training if the Government insisted on a VAT-enforced accounting method switch, Mr Roberts said the supermarket chain’s existing system made monthly comparisons so much easier.

With food retailers sometimes receiving up to 75 per cent of their business at weekends, he explained it was vital to detect when months contained five weekends as opposed to four.

“Months with an extra Thursday, Friday and Saturday could throw our figures into chaos if there are no weekly comparisons,” Mr Roberts told Tribune Business.

“Our success is our accounting success. We know what we’re doing. We have to always know what we’re doing, and we have to have comparisons, have to have percentages. It’s such a thin margin, you can’t lose control of anything.”

Comments

The_Oracle 5 years, 1 month ago

Incredible that the Government would consider "fining or penalizing" a business for wanting to be transparent and help the public understand! Educating the public will fall on the private sector very hard by default as the Government has been far from professional, competent or concise and keeps baiting and switching. They do not care how the private sector complies, just that they do, and do the job of collecting, a job they are incapable of obviously!

Given the "leniency"period is to last 2months, even though the general Government leniency period policy in regards to unpaid taxes is forever. Are they saying that Private sector education efforts must stop at 2 months? In any case, when the public realize what has been put on them the Government will no doubt point the finger at the private sector and deny any responsibility at all, even thought the full cause, need and effect lies at their feet! Only in the Bahamas...........

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ohdrap4 5 years, 1 month ago

I saw some bin tags at lowes pharmacy. it lists price x, vat y, total x+y effective jan 1, 2014

where there are not bin tags they have a little sign saying will be added to the displayed price come jan 1st 2015

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