Waiting for Dept of Statistics to conduct their first post VAT consumer spending survey ...... and then listen to what Brave and Halkitis would say ...................... LOL

It was never going to be just a 7.5% increase on the goods. This is because the businesses now pay 7.5% on all the services that they receive. Not all of the Vat on services is recoverable.

This means that the cost of delivering the goods has gone up, before Vat is applied. Then you have the fact that Vat is added not to the price of the goods when they are imported but to the cost+duty. In effect Government gets Customs Duty of say $100 and then charges 7.5% on that $100 so gets 107.5 in revenue. It is a kind of double dipping by Government.

Real cost is somewhere between 10 and 12%

Yep. They're not double dipping, they found a creative way to do exactly what they wanted to do. Since everything is imported, we pay 15%+ on everything. as you said, 7.5% to customs, that item goes in the store and we pay an additional 7.5%. The business doesn't swallow the 7.5% at customs, they include that in the price. Welcome to believing in Bahamians and no new taxes

If it were just a 7.5% increase, Joseph Sands (name changed, identity obscured, in Witness Protection, etc) would've seen his grocery bill rise from $150 per week to approx $161 a week. Or if the real effect is somewhere between 10-12% as you suggest, the groceries would now be costing $165-168 a week. Where this (possibly fictitious or otherwise nom-de-plumed) man gets his $260 a week figure from is really anyones guess.

In the old days people (real or imagined) interviewed for stories in the newspaper were asked for simple facts and evidence to back up their claims before they were published. In this case, a couple of grocery store receipts from pre VAT and post VAT, for an equivalent sort of family sized food purchase, might have lent a bit more weight to this story. Followed by a bit of basic analysis of how $150 plus 7.5% could (im)possibly become $260 overnight.

I don't like tax either. But news stories like this do nothing to help the argument because the numbers just don't stack up.

And who knows, perhaps Dr Minnis is not in fact Dr Minnis, but instead someone else whose name, possibly like Joseph Sands, has been changed at their request for fear of grocerical retribution?

I agree, this article seems to be biased and focusing on obviously poorly based information. What journalistic integrity would allow someone to say "People" are talking about increased costs and cite random "Name Changed" people as some fair sampling of the people.

And now to rub salt into the wounds there is talk of the VAT revenue not being used to run down the National debt but to fund more social programmes!!! Is there any limit to this administration's deceitfulness?

Deceitfulness?!?! You’re being too kind. They are down-right liars, thieves and professional bandits who cannot be trusted to manage any amount of money. Their next pillaging act will be to increase the VAT rate July 1, 2015 or by the end of the year. Wake Up Bahamas . . . especially you “diehards”.

The only choice people have is to cut back on spending. I wonder what would happen if that was the only choice government had? The only thing missing from the crime the government is committing against the people of the Bahamas is the gun stuck to our heads when they steal our money. When they take our money and we get nothing in return, that is outright THEFT!

Many persons that I have met. have no problems paying VAT. they said they go to the USA and pay their sales TAX so they can pay it in the Bahamas. As for cutting back many Bahamians including me and many children are over weight and we all will do well to eat less. as for my Church I increased my donations in 2015. Bahamians require service and we have to pay , but there are to many civil servants who give poor service. also if you have to depend on the Government medical facilities there is not much hope for you there.

and , as i was about to open my fat farm, people eating less because they cannot afford frozen meatballs anymore.

In the U.S. they have Freedom of Information and they know where their money is going. Also in the U.S. you get a "return" for your taxes. They have good schools, roads, water, electric, safety, and a functioning government that works FOR them. The same CAN NOT be said about the Bahamas. In the Bahamas the taxpayer is being ripped off, period! So madam, what service am I getting that is worth the tax I am being forced to pay?

So..VAT will improve customer service and give us a nation of skinny people? This sounds like just what we've been waiting for...

In addition Customs charges for clearing goods has gone up, so add 7.5% to that, and business license fees (by the new method of accounting by consolidating the businesses) went up last year (another increase that gets passed on in increased prices).

If you look at the 2013 and 2014 budgets, government fees have gone up on everything. Businesses are not charitable institutions so all those increases (Government increases) get passed on to the consumer.

The party most responsible for the increase cost of living is not the business community, it is the Bahamas Government.

solomon's at marathon has sectioned off their toiletries, and the customer is required to pay for the items inside the store, separately from the checkout counter.

the cashier computer terminal in that section prominently displays four camera shots for each of the toiletries aisles as a deterrent to shoplifting. i wonder why.

What about gas, they tax the hell out of gas already and then we must pay 7.5% on top of that, so in effect they are taxing you on a tax. Utter THEFT!

@Birdie, increasing the cost of foodstuffs for people struggling with their finances makes them fatter, not skinnier. Priced out of healthy fresh produce and protein they turn to cheap refined carbohydrates, and cheap sugary drinks like soda over juices (which are actually nearly as bad). Harried single mothers turn to inexpensive convenient fast foods. In the United States, low income areas correspond with obesity and diabetes, whereas higher income areas are fitter.

THIS Weekend has been the slowest for businesses in a long time. Usually the middle of January is slow as many households are broke after spending for the holidays then getting the children back in school but this weekend was extremely bad. Many streets were like ghost towns, attendants at gas stations fell asleep as there were few or no customers and even a number of food stores had few customers. Those who shopped did so with caution and the reality of vat is now being felt in the pocket of the consumer.

The higher the customs duties on an item the more VAT is paid at the port since duties and other local charges are added to the cost of the goods before vat is calculated. Never mind what John Rolle says companies with high duty items, slow turnover, high pilferage or high obsolecence of inventory will not be able to recover all the vat paid at the border by charging 7.5% when the government is taking much more. Let's say a boutique brings in a dozen dresses but is only able to sell 9 of them. Then the actual vat paid at the border is over 20%. unless that boutique has a markup of 300% they cannot recover the vat paid on the 12 dresses if they only sell nine. Stores like auto parts with an even higher custom duty rate a larger inventory and similar obsolecence will have an even greater challenge. Businesses that don't track their costs properly can easily find themselves working for government. Those who adjust their prices to cover costs will be branded as price gourging villins.

If I could only sell 9 of the 12 dresses I would be equally if not more concerned about the other 92.5% of their original cost of purchase (wholesale price of material, garment construction, freight, storage, handling and labor costs) that I might not recover either. This is normal business risk.

I guess you meant to say "the mormal business risk has been increased (substantially) by VAT." The things you mention would have been written into the original retail selling price of the dresses if it was expected that all may not sell or some may have to be sold at a reduced price. But when this is done, either the VAT will be lost totally (if the dresses are discarded or given to charity), or it will be substantially reduced if the dresses have to be similarly discounted.

VAT is now a cost of doing business. Its not something different, intangible, special or ringfenced separate from any other cost of production that is added and included in the final cost of the sale. That's the effect and proper treatment of a value-added consumption tax. It has no unique character that makes it different from any other cost of production if that product is subsequently marked down, binned or gifted to charity.

And you do realize, I hope, that as a dress retailer (for example) your business fully recovers from government (by way of offset) the full amount of VAT you have paid regardless of achieving a final sale of those leftover 3 dresses? The only loser is government, which loses the opportunity to gain tax revenue from 3 dresses that weren't sold (but lost opportunity isn't really actual loss).