Lower VAT rate on electricity under review

Government is considering whether it should continue to provide consumers with much-needed relief on their electricity bills.

Minister in the Ministry of Finance and Economic Affairs Ryan Straughn made the disclosure on Monday with the lower Value Added Tax (VAT) rate on electricity set to expire at the end of this month.

“This is currently being reviewed,” he told Barbados TODAY in a written response to a request for an update on the VAT relief. “We always review policy to determine its efficacy, given the stated objectives.”

In February this year, Straughn announced in Parliament that Barbados Light and Power Company’s domestic customers would pay 7.5 per cent VAT on the first 250 kilowatt-hours (kWh), instead of the usual 17.5 per cent rate, for an additional eight months, extending the arrangement that was put in place from August 1, 2022, to January 31, 2023.

(EJ)