Prime Minister Drew Commits to Addressing Price Gouging Amid VAT Reduction
Basseterre, St. Kitts, January 9th, 2025 (PMO)– Prime Minister Hon. Dr. Terrance Drew has reaffirmed his government’s commitment to protecting consumers from price gouging following the reduction of Value Added Tax (VAT) from 17% to 13%.
Speaking recently in a national broadcast, the Prime Minister emphasized that this tax relief measure was implemented to ease the financial burdens caused by global inflation and should directly benefit the citizens of St. Kitts and Nevis.
“The decision to reduce VAT was deliberate and designed to provide immediate relief to our people as they navigate rising costs. It is deeply concerning and unacceptable for some businesses to raise prices in an attempt to deny the public the benefits of this reduction. This government will not stand by and allow such behavior to go unchecked.”
To this, the Prime Minister announced that the Inland Revenue Department and Customs would intensify monitoring efforts to identify and address cases of price manipulation. These measures include reviewing invoices, profit margins, and pricing structures to ensure that businesses comply with the VAT reduction and pass on the savings to consumers. He also called on the media and citizens to actively report instances of unfair pricing to the appropriate authorities. “This is a collective effort. The government, the media, and the public must work together to hold businesses accountable and ensure that relief reaches those who need it most.”
Prime Minister Drew’s remarks reflect the broader context of a global inflation crisis that has affected countries worldwide, raising the cost of essential goods and services. St. Kitts and Nevis has not been immune to these pressures, with households experiencing higher prices for food, utilities, and other necessities. The VAT reduction is part of a suite of measures introduced by the government to combat these challenges, including subsidies on electricity and water, the launch of the Budget Boost Wallet, and initiatives to increase local food production through agricultural modernization.
“It is disheartening to hear that while the government is doing its part to support our people, there are some who seek to profit unfairly at their expense. This is not just a matter of economics; it is a matter of fairness and ethics. We will take swift and decisive action to ensure compliance,” the Prime Minister expressed.
He also highlighted the importance of such measures in fostering a sustainable and inclusive economic environment. He noted that the VAT reduction would help stimulate consumer spending, benefiting businesses in the long run through increased sales volume. “This is not a zero-sum game,” he explained. “When consumers have more purchasing power, it creates a ripple effect that benefits the entire economy. Businesses have a responsibility to support this vision.”
As part of the government’s commitment to ensuring fairness, Dr. Drew pledged ongoing engagement with stakeholders, including the Chamber of Industry and Commerce, to address concerns and monitor the VAT reduction’s impact. He encouraged all businesses to adopt ethical practices and embrace their role in the national effort to mitigate the effects of inflation.