VAT Relief Welcome But …

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By Petronella Sibeene

WINDHOEK

Consumers have welcomed the tax breather on selec-ted basic foodstuffs with a lukewarm response, as they feel the reprieve has excluded the common basic foodstuffs found in many households’ kitchens.

On Tuesday, President Hifikepunye Pohamba announced that the Government is going to implement zero-rate tax on beans, cooking oil and fat, bread and cake flour as soon as the VAT Amendment Bill is ready.

The announcement comes after weeks of looking up to Government to come up with measures that would relieve the masses groaning under soaring food prices that haunt many Namibian households.

“It is a good thing but more could have been done,” commented Alina Amutenya, an operator in the Small and Medium Enterprise (SME) industry.
According to Amutenya, prices will remain high on items such as rice, macaroni and sugar – commodities that are crucial in most homes.

Amutenya, who sells cooked meat, macaroni and rice says since the beginning of the year, she is unable to buy the usual eight kilogrammes of rice for her business as the amount she used to spend can only buy about four kilogrammes of rice.

“Rice is expensive and the price at which we sell a plate remains the same. People do not have money and everything is simply expensive and unaffordable,” she moaned.

Jenine Brendell, a cashier at a “King Pie” outlet applauded the Government for the initiative. However, she expressed reservations on the number of items that will no longer have to be taxed.

“It is good for us poor people but Government could have also considered bringing down the price of milk. You see, especially mothers, not all can afford formula for their babies. Some heavily depend on fresh milk to feed growing children,” she said.

Martha Kaijangu shared the same sentiments as Brendell and
added, “Milk is necessary for children’s growth and the price is too high and yet salaries remain the same.”

“It’s about time the Government reacted because for the past few months most people have been struggling to survive. Everything is expensive.

But most of all, the Government should have looked at the price of milk because of the nutritional value children need,” a concerned mother, Mariaan Rautenbach, also commented.

Last year, the Government introduced a 40 cents subsidy per litre of milk.
Although in 2003/4 the Government abolished VAT on mealie-meal and mahangu, the staple food for most Namibians especially those in the northern and north-eastern parts of the country, some members of the public grieved that prices are still high on these items.

“Government says maize meal is not taxed but we do not feel it. It is still expensive. Actually, the high prices on food have made it a struggle to put enough food on the table,” said Willem Matias, a father of seven children.

His friend, John Ndjigwa, says with winter at hand, most people drink coffee and they need sugar but the Government seems to have been short-sighted in ensuring that these items also get considered for zero-rate tax.

Meanwhile, retailers have welcomed the Government’s decision and await notification as to when they should implement the new measures.

Implementation, however, will only take place after Parliament debates the Amendment Bill. President Pohamba on Tuesday urged members of parliament to speedily work on the Bill in order for these measures to be effected.

Managing Director of Woermann Brock, Jesko Woermann, says despite cost implications involved, his business is eager to slash off 15 percent VAT on the suggested items by the Government.

Cost implications in terms of inventory software and pricing (computer programming) will cost Woermann Brock about N$10?

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