Basseterre, St. Kitts, May 02, 2022 (SKNIS): Given the “increasing inflationary pressures” faced by citizens and residents, the Federal Government adopted five (5) “short-term fiscal policy measures” for immediate implementation aimed at alleviating the rising cost of living in St. Kitts and Nevis.
These measures were announced on Monday, May 02 by Prime Minister and Minister of Finance, Dr. the Honourable Timothy Harris, during his address to the nation on the occasion of the 2022 Labour Day Observance.
One such measure was the approval to amend the price build-up for gasoline which was granted by the Government on April 13, 2022.
“The Excise Tax on the importation of fuel was reduced from $2.25 per gallon to $0.95. This significant reduction will be in place from April to September 2022. The Government also granted an increase in the Gas Station Dealers Margin by $0.30,” said Prime Minister Harris. “In addition to the amendment to the price build-up for gasoline, we will extend the Fuel Subsidy Programme for an additional six (6) months until September 2022. These measures are being done to mitigate the cost of fuel at the pump and to keep the cost of public transportation affordable for our people.”
Additionally, Prime Minister Harris indicated that the government will “extend the Income and Disability Support Programmes for an additional three months ending in June 2022.” This, he said, “will further assist workers who remain unemployed, are on significantly reduced wages or have additional expenses from caring for children with disabilities.”
Important to note, from May 01 to September 30, 2022, the Government reintroduced the duty-free allowance on the importation of food items by non-commercial importers. According to Dr. Harris, “this will be the longest period that such generous concessions have been granted to our people.” This initiative, which is usually given during the month of December, would allow households to import 500 pounds of food items free of duties and taxes. This measure will benefit persons on low incomes who spend a higher portion of their incomes on food.
The finance minister said that the fourth measure will see an eight-month cap placed on the freight cost that is used in the calculation of duties and taxes that are paid on the importation of goods.
“The cap will be set at the average freight cost for 2019, the year immediately preceding the onset of the pandemic. It is anticipated that this cap would help to moderate the rise in prices that is being observed as a result of increased freight cost. Let me take this opportunity to make very clear this Government’s firm expectation that all suppliers pass on the benefit of this concession to consumers who face rising prices,” said the Prime Minister. “The Department of Consumer Affairs will enhance monitoring of these developments to ensure that savings are passed on to the consumers.”
Finally, the removal of Value Added Tax (VAT) and Import Duty on hygiene items and the removal of Import Duty and Customs Service Charge on selected items such as vegetables, fruits, fruit juices, cough and cold preparations and vitamin supplements, will be extended for an additional six months – July to December 2022.