Georgetown, Friday, June 9, 2017: The Guyana Revenue Authority (GRA) has observed that notwithstanding the reduction in the VAT rate from 16% to 14% there has not been any incremental reduction in the prices of standard rated goods and services as intended by the 2017 budget measures.
Reduction in the VAT rate by 2% came into effect on February 1, 2017 following amendments to the Value Added Tax Regulations 2016. Additionally, the amendment provides for an increase in the VAT threshold from $10,000,000 to $15,000,000 annually. This new measure now makes it mandatory for businesses to register for VAT if their annual sales are equivalent to or exceeds the threshold of fifteen million dollars ($15,000,000).
It was observed that instead of a reduction in prices as intended by the budget changes businesses have apparently used the 2% reduction in VAT to increase their profit margins rather than passing on the intended benefit to the consumers.
It should be noted that GRA will be dispatching its enforcement officers to ensure compliance with the law. The Authority meanwhile is advising businesses to take corrective actions in such cases. Consumers are also being urged to assist in being vigilant and report entities that fail to adhere to the changes in the prices of goods and services.
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