Dear Editor,
Someone is not doing their homework in the Ministry of Finance.
It was as clear as day would follow night that come Jan 1, 2007 prices for 90 % of commodities would go up and this is as a direct result of the powers that be not taking into consideration that all businesses would have had stock purchased way before December 2006 on hand on which 30% C/tax was paid already, remember the Minister of Finance and his colleagues in the GRA are only giving stock relief up to the 16% vat rate for merchandise purchased in December 06 with an ultimatum to business to get rid of that stock by March 31 2007.
Now there are two things critically wrong with this approach, one is that they are forcing businesses to lose on their old stock while the government makes a windfall by collecting more taxes upon merchandise that incurred 30% C/tax already in 2006.We have seen in the media advertisements by huge companies stating that they would incur the losses on old stock.
No business willingly loses money. Secondly, the government is sending a morbid signal to businesses that they are not pro business.
This does not augur well for Guyana. Guyanese-owned large and small businessess are important as they create jobs in their communities where they are located.
Let me state clearly that I support VAT but the government can hardly think that 3 months of educational blitz on VAT is enough to foist it upon Guyanese taking into consideration the major implications it has on the lives of Guyanese. VAT should be implemented in a more business friendly manner. Of course we all stand to benefit in the long run with new imports from Jan 1, 2007. Having said this, one can only hope that the government is not anticipating that importers importing after Jan 1, 2007 would undersell businesses with old stock here again forcing businesses with old stock, to sell at a loss, but they may be in for a surprise as new imports piggy back on the rise of the old stock prices. Can the Chamber of Commerce state its position on this old-stock issue.
Yours faithfully,
(name and address supplied)
