Opposition Leader Bishop Joseph Atherley is calling on Government to clearly explain to citizens how it intends to implement a proposed cap on the Valued Added Tax (VAT) applied to fuel products to give Barbadians an ease at the pump.
The leader of the People’s Party for Democracy and Development (PdP) told Barbados TODAY that while he agrees that several of the taxes Barbadians pay support many of the public services they access – such as healthcare and subsidized education – the current level of taxation, specifically on fuel, will continue to have an adverse effect on economic activity if not quickly addressed.
“Yes, revenue for Government is reduced but at the same time, if you continue to impose these high levels of taxation on the Barbadian public, whether it’s through a fuel charge or any of the other impositions, if you continue to do that you are reducing the potential market of people who are going to be out there and who are in the position to be paying these taxes. You are therefore contracting economic activity,” Bishop Atherley contended.
He also responded to Government’s position that nothing could be done about the current taxes on fuel, saying that it was the administration’s own policy to implement this level of taxation so it could make changes.
“You can’t simply say you ‘can’t ease the burden of taxes at the pump now but what we will do is probably cap the VAT’. What does it mean to cap the VAT? Now you are getting involved in all of these technical languages, you are hiding behind your policy position.
“Ambassador Dr Clyde Mascoll [Government’s Chief Economic Advisor] came and told the country there was nothing that Government had done that added to the cost of fuel to the people in Barbados, and that is not true. By imposing your taxes, you created a situation that when price import inflation occurred on fuel coming in from overseas, your taxes on top of that would always make the situation worse,” Atherley added.
He said the excuse being offered about the current crisis not being predicted was a poor one, given the island’s history with international fuel crises that often adversely affected prices.
“Barbados was plunged into a crisis already before, because of increases on [fuel] coming into Barbados from overseas during the global oil crisis in the 1980s. So these things are not new. Government is responsible to see what they can do on this side to ease the burden. If you don’t, you are going to be adding to the trimming of economic activity,” the Opposition Leader insisted.
“The guy who now has to pay $3.88 per litre will not go in at Chefette and buy the snack box with the regularity he used to; he will not go into the store in town and buy an expensive pants or shirt like he used to. The lady who does her nails will not do it as often as she did, if you have these increased prices. Economic activity is trimmed.”
In Bishop Atherley’s view, Government not only needs to address the situation promptly, but explain thoroughly how the suggested reduction in costs will work to Barbadians’ benefit. (SB)