Day dubbed Black Thursday
BASSETERRE, St. Kitts – FURTHER relief will be provided for persons doing their Christmas shopping, with the recent announcement of a one-day reduction in the Value Added Tax (VAT) from 17 percent to seven on goods.
The announcement was made just hours ago (Dec. 15) by Prime Minister and Minister of Finance, the Right Hon. Dr. Denzil L. Douglas while wrapping up the debate on the Appropriation 2012 Bill, 2011 in the House of Parliament.
Last week, the Prime Minister announced Cabinet’s approval of “an EC$1 500 allowance on imports during December and the permanent removal of the seven-day stay overseas to benefit from the EC$400 allowance”.
This decision did not sit well with the Chamber which felt that rather than encouraging customers to shop locally, it was encouraging them to shop overseas, which would have a negative impact on business.
And at a recently-held press conference, Dr. Douglas indicated that he had received a letter from the Chamber and that he had committed to review the situation, which led to discussions between the two. And those discussions have led to the present agreement to take effect on Thursday (Dec. 22).
“After listening with the members of the Chamber of Industry and Commerce, led by the President himself, Mr. Morton, we have agreed that we shall have that day, December 22nd…Black Thursday… one minute after Midnight to 11:59 p.m. on Thursday night, we shall remove 10 percent from VAT on all shopping that will be done on that day.
“All goods that are being sold on that day will be not at 17 percent VAT but at seven percent VAT only. And when I say goods, I mean goods; food in particular, building material, appliances…”
As explained in a release issued by the St. Kitts-Nevis Chamber of Industry and Commerce (CIC), it is in support of the initiative.
“Following discussions held on Tuesday, 13th December 2011 between the Prime Minister, Dr. the Right Honourable Denzil Douglas, members of the Ministry of Finance and representatives of the St. Kitts and Nevis Chamber of lndustry and Commerce, the Chamber is pleased to support the implementation a 7% VAT day on Thursday 22nd December 2011, as announced by the Prime Minister.
“The Chamber is pleased in particular with the assistance given to all those persons who remain at home to support the local economy with their purchases throughout the Christmas and Carnival Season, and encourages all VAT registered businesses to participate in this venture and, where possible, to add their own discount incentives to ensure this measure will result in a most rewarding shopping experience for all local consumers.”
The conditions of the initiative, as spelt out in the press release, are that, in order to sell their goods at the reduced rate, businesses “must apply in writing to and receive formal approval from the VAT office” and items purchased prior to December 22 and returned would not qualify for the reduced rate to be applied.
Additionally, the seven percent VAT is applicable for only a 24-hour period and “all goods sold by any of the approved businesses will qualify. These include food and other groceries, household furniture and furnishings, hardware and building materials, motor vehicles and spare parts” but do not include services.
Commenting on the decision to enact the one-day VAT reduction, Dr. Douglas expressed, “This, again making the point that I said, wherever we can bring relief we shall because that is the nature of this Labour government. It is a caring government.”
