President Irfaan Ali has ordered that freight charges be reduced to pre-pandemic levels in order to lower taxes on imports, thereby relieving consumers of higher prices that have been passed on due to higher shipping costs.
In a press release, the Office of the President (OP) said the Customs Act, and the Value Added Tax Act will be amended to reflect the concession, which is effective on all invoices dated August 1 and continues in effect until January 31, 2022.
“This measure will allow for a saving of $4.8 billion to the consumer and business community over the six month period, thereby reducing revenue collections by the similar amount of $4.8 billion,” it explained.
OP noted that in monitoring the socio-economic effects of the pandemic on household income, the government had recognized the marked increase in shipping costs from some countries, which has moved from an average of 2,500 to as much as 15,000 US dollars per 20 foot container and from 3,500 to over 20,000 USD for a 40 foot container.
