STATEMENT: Beginning the first of April, this year, VAT will go down to zero for unprepared food sold at the food store. How much your family will save depends on what you buy and how it was taxed previously. All Bahamians who buy food at the market will see relief.
The Nassau Guardian this morning committed a miscalculation in their front-page story and headline this morning, with an erroneous claim that the average household will save $11 a month after the April 1 VAT cut.
The Guardian mistakenly equated the fiscal impact of the VAT cut a $15 million revenue loss with the consumer benefit. The government’s $15 million is a bottom-line fiscal impact number after accounting for business credits and substituted spending. The total dollars left in Bahamian pockets at the grocery store checkout gross relief will be the sum of VAT removed from the final retail price of all food sold, which is a significantly larger pool of money.
