Basseterre, St. Kitts, January 17, 2025 (SKNIS): The global rise in food prices continues to place significant pressure on economies and households worldwide. This surge is driven by a combination of factors, including supply chain disruptions, climate-related agricultural challenges, and heightened demand in the international market. For small island states like St. Kitts and Nevis, these external shocks resonate deeply, given our reliance on imported goods. The Government of St. Kitts and Nevis, under the leadership of Prime Minister Hon. Dr. Terrance Drew, recognizes the urgency of this situation and has implemented bold measures to alleviate the financial strain on our citizens.
As part of the Government’s 2025 Budget Address, a comprehensive suite of initiatives has been introduced to ease the financial burdens of our people. Chief among these is the Value Added Tax (VAT) reduction from 17 to 13 percent for the first six months of 2025. This VAT relief is expected to lower the cost of essential goods, including food items, thereby providing immediate relief to households navigating rising grocery bills.
In addition to the VAT reduction, the government introduced the Budget Boost Wallet (BBW) programme, targeting individuals earning $5,000 or less per month. Eligible recipients will receive $250 per month from January to June 2025, providing direct financial assistance to those most impacted by the rising cost of living. This programme underscores the government’s commitment to prioritising vulnerable populations and ensuring that no one is left behind during these challenging times.
To further support its people, the government has spent a substantial $320 million to fund essential subsidies and social programmes over the past two years. This allocation ensures that subsidies on critical utilities and services remain accessible, helping to cushion the economic impact of global inflation. Moreover, the extension of the “Build & Thrive Incentive” for renovations and repairs offers VAT reductions and waivers on import duties and customs charges, enabling citizens to invest in their homes and maintain stability.
The 2025 budget also reflects a deep understanding of the importance of fair wages and income security. A historic increase in the national minimum wage to $500 per week, effective July 1, 2025, marks another step toward ensuring that workers can sustain themselves and their families amidst escalating costs. These financial interventions are complemented by a continued focus on pension increases and bonuses for civil servants and pensioners, further boosting household incomes.
The Government of St. Kitts and Nevis remains steadfast in its resolve to shield its citizens from the ripple effects of global economic pressures. These measures are not just policies but a testament to the leadership’s empathy and foresight. While the challenges ahead are formidable, the initiatives laid out in the 2025 Budget provide a clear pathway toward resilience and recovery. As we navigate this period together, the government calls on all citizens to remain hopeful and committed to building a more sustainable and inclusive future for St. Kitts and Nevis.