By NEIL HARTNELL
Tribune Business Editor
Super Value’s principal yesterday backed calls to remove VAT from breadbasket foods as a means to ease the burden soaring inflation has imposed on hard-pressed consumers still struggling to recover from COVID-19’s fall-out.
Rupert Roberts told Tribune Business that “I’d certainly agree” eliminating the 10 percent levy on products such as bread, rice, flour, butter and baby food/formula would help lessen the pressure on low income Bahamians and other vulnerable groups struggling to make ends meet amid wide-ranging price hikes.
“I hear a lot of consumers talking about how government should pull back on price controlled items, take VAT off the breadbasket items,” he said. “That’s what consumers are saying, and I hear it. The consumers are telling their representatives [MPs] and telling us and our store managers. If you want to get a funny feeling in your stomach, listen to the consumers when they are shopping. They are finding it hard.”
Asked whether he would support removing 10 percent VAT from price-controlled breadbasket food staples, Mr Roberts responded: “I’d agree certainly. I’d take them off. All we have to do is touch a button and that goes away. I’d be glad if Mr Halkitis gave me the word.”
The Super Value chief spoke after VAT and breadbasket foods, together with what some are terming “the cost of living crisis” now facing Bahamians and all countries, provoked a furious row in the House of Assembly between the Free National Movement’s (FNM) deputy leader, Shannendon Cartwright, and Glenys Hanna Martin, minister of education.
The Opposition has frequently attacked the Government’s decision to reimpose VAT on breadbasket foods and medicines, making them VAT-able for consumers once again by removing the zero rating and exemption tax breaks introduced by the former Minnis administration as part of cutting the rate from 12 percent to 10 percent. It has sought to portray the Davis administration as insensitive and heartless, especially when it comes to the plight of the poor and working class.
Mr Cartwright resumed this offensive yesterday, renewing calls for the zero ratings and exemptions to be reinstated. Pointing to reports of a “US trucking recession”, and potential further price hikes and supply chain disruption that will result, he said: “We’re asking the Government to take VAT off breadbasket items, bring some relief to the Bahamian people.”
With many struggling “to survive right now” and stretch their dollars to meet their essential needs, and those of their family, the FNM deputy leader said many were having to choose what they eat and when they ate. “Persons are messaging me on a daily basis, battling to stretch $20 to meet the needs of their families. We must make this change to bring relief to poor, working class and middle class Bahamians,” Mr Cartwright asserted.
“The Bahamian people are out there hurting, and desperately need relief. Go no further than the food stores. You hear the cries of people at the cash register, and you hear the cries of people at the gas pump.” Arguing that Bahamians “cannot carry any more”, the St Barnabas MP said: “We continue to put the burden on working class Bahamians, and must do something about it.
“The Government makes decisions every day to find relief in many ways, but the biggest relief is for Bahamians out there hurting every single day. I wish I had time to read some of the messages I get; it’s harrowing to see what people are dealing with. We can come here today, the Government can come here today, and move VAT off breadbasket items.
“I had a message from a lady the other day saying she couldn’t get as much of her blood pressure pills. The Bahamian people are hurting, and they expect us to do something. Take VAT off breadbasket items.”
Mrs Hanna Martin, though accused the FNM deputy leader of seeking to score “a political point” by calling for VAT’s removal from breadbasket items and the return of zero rating/exemption tax breaks for consumers. She hit back by pointing out that Mr Cartwright voted in favour of the former government hiking the VAT rate from 7.5 percent to 12 percent in 2018, and questioned where his concern for the poor was then.
“I’m wondering if he has just arrived in the reality of what is going on in this country,” the minister said, pointing to COVID-19’s devastating economic impact when many Bahamians no longer had a single dollar to their name. Saying that she had been dealing with constituents unable to afford vital medicines for years, Mrs Hanna Martin said: “I didn’t hear the member for St Barnabas crying for the poor then.”
Agreeing that there was “a level of hardship” in Bahamian society, she added: “I know the people of this country have been suffering for an extended period. He [Mr Cartwright] acts as if this is a new phenomenon because he wants to make a political point.”
Mr Cartwright retorted that all Bahamians knew he cared about the poor, adding that “the question is what the Government doing now”. This sparked a furious exchange between the duo, and prompted the intervention of the House of Assembly’s deputy speaker.
The issue of whether to implement or eliminate VAT on breadbasket foods and medicines has always been a controversial topic. The Minnis administration did the latter in 2018, hoping it would ease the burden of the rate hike to 12 percent for low income and working class Bahamians, while also fulfilling an election campaign pledge.
However, various experts had urged The Bahamas to maintain a low-rate, broad-based VAT when it was introduced in 2015 and keep zero ratings, exemptions and other tax breaks to a minimum. The latter was seen as undermining the efficiency and administration of the tax, and it was recommended that increased social assistance instead be provided to mitigate its impact on poor and low income Bahamians.