By Sue-Ann Wayow
FINANCE Minister Colm Imbert is seeking to clarify information regarding food items and the Value Added Tax (VAT) announced in his Budget presentation on Monday and a revised list has been issued following a meeting with the Supermarket Association of Trinidad and Tobago (SATT) on Wednesday.
In a release on Wednesday by the Ministry of Finance, the minister stated that he has taken note of comments being made publicly that the Government intends to make several basic foods VAT-free or zero rated for VAT and in particular, commentary about which food items are currently subject to VAT and which are not.
In the 2022 Budget Statement, presented, several items were identified by Imbert, by way of example, which would now be free of VAT as of November 1, including biscuits, cooking oil, canned vegetables, cornflakes, canned fish, canned meat, curry, juice, sausages, ham, ketchup, bottled water and pigtail.
The ministry stated, “This was not an exhaustive list. It was simply designed to illustrate some of the most commonly purchased items in supermarkets by most households, where the Government can influence the prices of these items downwards by making them free of VAT.”
The Minister of Finance was grateful for the public commentary because it allowed him to clarify the Government’s policy decision regarding the list of basic foods being considered for zero-rating for VAT, and to clear up misinformation that was being spread in the public domain, the ministry stated.
Mentioning the February 2016 zero-rated list, the ministry stated that in that list, the first broad category of food that was made free of VAT was “unprocessed food of a kind used for human consumption”. This classification allows all unprocessed vegetables, fruit, meat and fish to enter Trinidad and Tobago and to be sold free of VAT. The definition of “unprocessed food” means that the food contains no additives.
After that broad category of unprocessed food, several basic food items that are “processed” were identified on the list on a stand-alone basis as being zero-rated for VAT. These include items such as sardines, corned beef, bread, flour, pasteurized milk, rice etc.
Not all canned items are presently VAT free
The ministry stated that canned sausages are not VAT free at present, nor are any other canned meats, other than corned beef. Similarly, while sardines and smoked herring are free of VAT, Tuna and Mackerel are not VAT free, as is also the case with other canned fish.
No canned vegetables are currently free of VAT, such as corn, peas and mixed vegetables.
Curry error
The ministry admitted that in the case of curry, that was indeed an error on the list of items recommended for removal of VAT that was sent by SATT to the minister on Sunday and not picked up by the technocrats in the Ministry.
The minister thanked SATT for its collaborative approach with the Government in identifying the most commonly used foods and ascribes no blame for that minor typographical error, particularly since that is the only item on the list of examples read out by Imbert that is currently free of VAT.
It is to be noted that although curry is indeed VAT-free, black pepper and other seasonings are not VAT free. Neither is ghee, and these latter items are all on the proposed comprehensive list of food items that will now be zero-rated for VAT on November 1.
Complete VAT free list
The proposed list of items to be now made free of VAT is as follows: vegetable/soya bean oil, olive oil, coconut oil, canola oil, ghee, peanut butter, black pepper and other spices.
Also family cereal, kid’s cereals, hot cereal oats, milk substitute, condensed milk, instant coffee, ground coffee, steel cut oats, black tea (3kg and under), green tea (3kg and under), orange juice, apple juice and still water (bottled water).
Seasoned meat, sausages, canned or otherwise packaged, canned tuna, canned mackerel, canned peas, canned beans, canned corn, canned mixed vegetables, mayonnaise, ketchup, roti skin, soup (packaged), geera (crushed or ground), soya chunks, soya minced, ground dhal, cheese slices, table butter, pigtail, ham slices, turkey slices, chicken lunchmeats, bologna, fresh juice, biscuits and crackers are all included in the list.
The ministry stated, “It is noteworthy that this list has been very carefully chosen in collaboration with various stakeholders to represent the most commonly used foods that are currently subject to VAT. The zero-rated list will be amended from time to time, to add more basic items as circumstances require and deserve, and as funds permit. We trust this clarifies the situation.”
SATT appreciative
SATT has acknowledged the revised list from the ministry in statement on Thursday.
SATT stated, “The Minister of Finance demonstrated an appreciable empathy for the plight faced by consumers and worked closely with SATT in the immediate aftermath of the budget to survey a more expansive look at the widening of the basket of basic food items to be made VAT free. The breadth of knowledge demonstrated by himself in the treatment of VAT as a complex issue while intimating that the initial list was open to expansion as formulated and subsequently evidenced in a data driven exercise to examine those items most often purchased by families in the supermarkets.”
SATT added that the Association was grateful for the opportunity to meet with the minister on Wednesday to expand the list of prices.
