By: Spokesman Newsroom
BASSETERRE, St. Kitts (Wednesday, 8th January 2025)-Prime Minister and Minister of Finance Dr. Terrance Drew has issued a strong appeal to vendors to ensure that the benefits of the six-month (January to June) relief measures for 2025 are passed directly to consumers.
Dr. Drew highlighted the government’s decision to reduce the VAT rate from 17% to 13%, aimed at alleviating the cost of living for citizens during The Round Table media session.
Responding to a reporter who pointed out complaints from consumers about price hikes, he (the Prime Minister) made it clear that the savings from this reduction must be reflected in lower prices for consumers.
“I’ve asked the Cab Sec [Cabinet Secretary], Inland Revenue have sent out their information, to meet with vendors and to meet with, for example, the chamber, because we want these savings to be passed on to our people. We want them to save. VAT comes down to 13%, so the price dropped; not that you [the vendors] take down the VAT and the price remains the same,” the Finance Minister emphasized.
Dr. Drew assured the public of his commitment to monitoring the situation personally.
“I’ve said myself, I will go to some of these vendors and see. I will do it myself. I’m going to do it myself and ensure that these prices are dropping for our people. Because why would the government give a significant drop in VAT, a promise that we made but we recognize is important-and that is not passed on to the people? That is what I’m talking about.”
Dr. Drew further said: “We are going to get out there because this cannot be acceptable. How can you have savings for the people and then you as a trader want to keep the savings? No! This is totally unacceptable!”
He warned that such practices, which he labeled as price gouging, would not be tolerated:
“I’m going to ask customs to show us how much it was paid for and what is the markup. I’m going to ask customs to do their jobs and call out those who have done it. I’m asking the traders: you will benefit because there will be a boost in volume, why not pass the savings on to the people? That is not fair for those who are engaged in such, I will not accept that.”
Dr. Drew also encouraged the media to play a role in addressing the issue:
“The media has to help us with this. Call them out; Why are you carrying up the prices when the government has dropped the VAT? That is what you call price gouging, and we will deal with that.”
In addition to the VAT reduction, Dr. Drew elaborated on the government’s Budget Boost Wallet initiative, which will provide $1,500 over six months to qualifying individuals earning less than $5,000 monthly. As gathered, this programme is designed to assist with essential purchases and utility bills, offering significant relief to both lower-income and middle-class households.
“The Budget Boost Wallet is a strategic response to deal with the rising cost of living,” PM Drew explained. “It’s not per household but per person, so if you have three people in a house, each will get $1,500 over the six months, with monthly installments of $250. Families can decide how to allocate these funds-for electricity, water, groceries, or other essentials.”
It was highlighted that the wallet will be accessed through a digital platform, ensuring ease and convenience for users.
“You’ll get it on your phone in a wallet, almost like an account. You can use it to pay utility bills like SKELEC or the Water Department, or purchase groceries from registered vendors. The money is transferable and acts like cash, but you can’t use it for alcohol, tobacco, or luxury items. This ensures that it’s spent on essential needs,” Dr. Drew clarified.
As understood, for individuals without smartphones, the government is working on alternative solutions to ensure everyone can benefit from the programme.
Dr. Drew emphasized that this initiative was designed to extend relief beyond lower-income families saying: “Normally, programs like this target only those on the lower end, but we recognize that the middle class-teachers, police [officers], some nurses-have also struggled. That’s why we’ve included them. We want to give every qualifying household an ease during these challenging times.”
The Prime Minister expressed optimism that the combined efforts of the VAT reduction and the Budget Boost Wallet would provide substantial relief to citizens while also stimulating the local economy.
“This is about ensuring that our people feel the benefits directly. We’re using innovative technology and targeted policies to provide tangible support to families across the Federation,” he stated.