Increased prices are not only due to business exploiters

Dear Mr Sattaur,

In your letter to the editor published in the Guyana Chronicle on January 16, 2007 and the next day in Stabroek News you accused us of being biased. You are right; we are biased. We are speaking for ourselves and other grassroots women like us. This is not an academic debate to us, and we cannot nor are we not trying to tell “the whole story”. We are trying to tell our story, which is that since VAT was introduced we are being asked to pay prices that are too high for us to bear.

It seems that you believe the only reason prices are soaring is because the business people are exploiting the consumers. Mr Sattaur, you will never have to teach any grassroots women that some business people exploit consumers; we are the main consumers they exploit and there have been many instances since VAT was introduced where we have refused to buy from such people. What we can’t understand is why you seem so offended that we think there are decent businessmen and women. Are you saying that none of them is decent and all of them who are raising prices are nasty exploiters?

You can’t be saying that.

And since this is a matter of survival for us, we have to look at all of the reasons why the prices for the goods and services we buy have gone up so high, and the reasons we find include the following:

1. You said that we ignored the fact that 400 items which were previously taxed 30% consumption tax are now subject to only 16% VAT and so their prices would go down.

We know that. We took the trouble to go to presentations by VAT staff and we listen to what they say on the TV. What we have said from the beginning, which you continue to ignore, is that you failed to check how many of those items poor people like us use as basic to our needs. There are many items in our basket of goods which had no consumption tax before or a consumption tax lower than 16%, and their prices therefore had to go up. As we said in our Open Letter to the President of Guyana, in real life there is no such thing as an “average” income or an “average” basket of goods; there are baskets of goods for rich people, baskets of goods for middle class people; and baskets of goods for poor people.

2. We believe that the arrangements for old stock are not good enough since they consist of a 16% reimbursement for goods bought in December and sold by March; even business people who don’t make a living by exploiting consumers will raise their prices if they are not getting relief for the consumption tax they paid. In fact the only one to benefit from this “extra” tax, is your department – not the business places.

3. Small business people who are not registered because they do not sell $10 million a year will pass on the VAT they pay on their inputs to us, which means that at least some of their prices will go up. We know a lot of women who are small vendors, in fact we call them micro vendors, who are in this position.

The fact that VAT has been set at the high level of 16% makes all these problems worse.

Mr Sattaur, until these problems are corrected we will continue to speak out and to speak out in our own interests, based on our own experience, because like we said, we grassroots women are the ones “living on the front line”.

Even though our letter was addressed to the President. the answer came from you. Before we read it, we were hoping at least that as the person responsible for administering VAT you would show interest in receiving more feedback on the impact it is having on the lives of poor people. Since you do not consider it your role to be sensitive to our situation, we are waiting now to see if our elected representatives in Parliament will hear what we are saying.

Yours faithfully,

Nicola Marcus, Halima Khan, Joycelyn Bacchus, Core Belle Roberts, Vanessa Ross, Wintress White

Red Thread

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