“It’s VAT and VAT and VAT everywhere!” Opposition Chief Whip Gail Teixeira exclaimed as she moved a motion in the National Assembly calling on Government to repeal the new Value Added Tax (VAT) regime, which comes into effect today (February 1).
The motion, which challenges Government’s decision to eliminate zero-rated VAT items and extend the list of VAT exempt items, had the full support of otherOpposition parliamentarians, some of whom contributed to the lengthy debate on the issue.
Teixeira highlighted how almost everything, even down to the dead, would be subjected to VAT, as she called on the Government to put an end to this unnecessary burden on the people of Guyana.
“Not even the dead can live in peace!” she remarked, noting that funeral services, which were previously zero-rated, would now attract VAT.
Teixeira outlined that services in the health sector, the cost for over-the-counter drugs, educational materials, religious books, sports gear, as well as local products, are now attracting 14 per cent VAT – making it even more challenging for the average man to rid himself and his family of poverty.
Teixeira also argued that VAT on basic items such as educational materials, health purchases and sports gear went against promises made by the Government to reduce school drop-outs, to solve the Maths problem facingstudents, to encourage youth from turning to crime and to foster a healthy nation.
She explained if basic items such as erasers and geometry sets now attracted VAT, then it becomes increasingly difficult for struggling families to keep their children in school.
On the other hand, Junior Finance Minister Jaipaul Sharma explained that Government’s new tax regime was to facilitate equal wealth distribution and the Private Sector was to be blamed for the increases passed on to the poor.
Sharma argued that the switch from zero-rated items to exempt should not come at a cost to consumers, but it was the businesses who were taking advantage of the change to exploit the spending public.
“In both cases, where it is zero-rated and exempted, there is no VAT to be put on that bill. You will not be seeing any VAT on that receipt…so this issue of persons paying VAT is a misnomer,” he explained.
He argued that businesses should not be charging consumers VAT if the items are exempt.