By NICO SCAVELLA
Tribune Staff Reporter
nscavella@tribunemedia.net
GALLERIA Cinemas President Chris Mortimer yesterday said the recent increase in movie ticket prices was the result of a “myriad of costs” experienced by the company since the implementation of the government’s new tax regime.
Mr Mortimer said “electricity costs,” “accounting costs” and “supplier prices” have all risen because of the implementation of the government’s 7.5 per cent value added tax (VAT), which came into effect on January 1.
As a result, he said, the new prices were reflective of Galleria’s “compliance with VAT and the significant operational expenditures that are directly tied to it.”
Mr Mortimer is also deputy leader of the Democratic National Alliance (DNA).
Last week, The Tribune reported that Galleria Cinemas posted VAT notices in its ticket windows informing customers that in compliance with legislation, prices would increase as of January 1, noting a 17.6 per cent and 11 per cent increase in (VAT-inclusive) adult and children’s ticket prices respectively.
On Monday, Price Control Commission Chairman EJ Bowe called the prices “outrageous” and said the commission would be “looking into” the matter.
When contacted by The Tribune for comment yesterday, Mr Mortimer suggested that the spike in prices were in line with VAT regulations, and also criticised Mr Bowe for making “an assessment in his official capacity about an industry” that he “does not understand.”
“What was reflected on the notice was evidence of our compliance with VAT and the significant operational expenditures that are directly tied to it,” Mr Mortimer told The Tribune yesterday. “Electricity costs alone are up 150 per cent pre-VAT. Accounting costs are up 100 per cent because of VAT. Supplier prices are all up.”
According to Galleria’s VAT notice, ticket prices were increased from $8.50 to $10 for adults (an increase of 17.6 per cent), and from $4.50 to $5 for children (an extra 11 per cent). Senior citizens would now pay $9.
However, some consumers questioned why they were being charged $10 for an adult ticket when 7.5 per cent of $8.50 is $0.64, bringing what should be the VAT-inclusive price to $9.14.
VAT at 7.5 per cent on a children’s ticket would amount to $0.34, bringing the VAT-inclusive price to $4.84.
After leading Price Control inspectors on an inspection of Super Value’s East Street and Robinson Road stores on Monday, Mr Bowe said he would be “looking into” the Galleria matter, reportedly calling the prices “outrageous.”
“Since VAT came into being, (Galleria’s prices) went up,” Mr Bowe said. “But according to the complaint we got, the calculation does not compute, because 7.5 per cent onto what they were selling it for cannot bring it to that figure that they are selling it to the consumers for. So we’ll be checking that out as well.”
Mr Mortimer criticised Mr Bowe yesterday, however, calling it “unfortunate” for him to “make an assessment in his official capacity” about an “industry which does not fall in his portfolio and which he does not understand.”
“Should he have asked,” Mr Mortimer added, “I would have taken the opportunity to inform him prior him giving credence to an incorrect perception of price gouging.”
On Monday, Mr Bowe said the PCC was “totally committed” to combatting “price gouging” by retailers in New Providence. He said any retailer found engaging in price gouging or in violation of the VAT regulations would be subject to prosecution, the penalty for every item found over priced being $5,000.
Comments
DonAnthony 9 years, 3 months ago
Movie ticket prices are not price controlled so the government should have nothing to say about the price of a ticket. It is not an essential good so if you feel it is too expensive then do not buy it. The govt. as usual is deflecting blame. The private sector did not waste our tax dollars through corruption and waste and inefficiency, our many corrupt governments are reposnsible for our exorbitant national debt, and for all the misery Vat will inflict on the poor and middle class.
ohdrap4 9 years, 3 months ago
If the poor do not have bread, let them go to the movies.
hj 9 years, 3 months ago
If movie prices are not price controlled what will he investigate? I don't know if the new price reflects only his increased costs or he decided to also increase the profit margin in the process. In any case only an idiot would truly believe that VAT would not bring inflation. The blame game has began
GrassRoot 9 years, 3 months ago
exactly. it will keep Mr.The Price is Right busy though with chicken shit, swamps his desk with "too much work" to go after the big, government controlled scams, smoke screen, opium for the people, give them cents and keep the dollars.
GrassRoot 9 years, 3 months ago
in the ages of VOD, who cares if the theatre is pricing itself out of the market? If you want used chewing gum on your shoes and ketchup on your jeans you go to the theater here. So this market is quite competitive and we should not worry about chicken shit like that. I would love to see that Mr. -The-Price-is-Right breaks up the big scams in the Bahamas, such as the gas price cartel.
Emac 9 years, 3 months ago
Who cares?! Movies theatres, like the once popular Drive-Ins will become obsolete. Many people are opting to purchase wonderful little gadgets like the Amazon Fire TV or the Android TV boxes, stay at home, get a snack and watch any movie SAFELY, without going out in this jungle, from the comfort of their home. The world is changing-Any movie that is at the theatre can now be seen at home. Beside, the only people that really go to movies are teenagers, who see this as an outlet to hookup with each other.
Girly 9 years, 3 months ago
So true. You hit the nail right on the head. With all this VAT, I wonder if anyone would want to go and see a movie anymore. BRING THE DVD's.
Emac 9 years, 3 months ago
yep
TheMadHatter 9 years, 3 months ago
I enjoy the RND cinemas, and an extra $1.50 is quite fine to enjoy a night out with other people - watch the big screen, hear the nice sound - and get some snacks.
It is good to be out with other humans. Many times the theatre is packed and I believe it will continue its awesome success this year and many years to come.
TheMadHatter
Emac 9 years, 3 months ago
Unfortunately not everyone can afford the extra $1.50 You can get the same big screen and surround sound at home. As far as being out with other humans are concerned, I only watch movies with dogs on Thursday nights, the other nights are dedicated to humans, Lol. But seriously though, kudos to those who can still afford to out.
The_Messenger 9 years, 3 months ago
Mr. Mortimer is 100% correct, his business like all businesses in the Bahamas have had their cost of doing business going through the roof for years and now the government wants to price control them because they are raising costs to make ends meet.
Give me a break, these so called leaders are a bunch of effin morons that are nothing but incompetent fools when it comes to understanding how business works. They want businesses to lower their prices? Start by lowering duties across the board like what was supposed to be done when VAT was implemented and fix the cost of power which is nothing but a catastrophe in this country.
Fools.
winehting 9 years, 3 months ago
Some Bizzznizz people will try cheat an put more cents or dollars on they items but from these is a price office going around to al these bizznizzs by law they suppose to get posecuted or shout down....minimum wage need to rise since vat is on.so the poorer class can meet the expense..we don't need a hand to mouth system we need a system that up lift the country so from the government has good use for the tax money then the nation should no about their plans an don't keep it a secret to rob the money...from the government don't have controll over the movie price that don't mean they need to rise the movie ticket to a rate where movie lovers will complain....but for me adont really have a complain about the price though
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