SUPER Value’s owner yesterday said will appeal to government for permission to revert to Value Added Tax (VAT) ‘exclusive’ pricing, blaming the switch for this year’s 10 per cent sales decline.
Rupert Roberts, while likely reigniting the ‘inclusive’ versus ‘exclusive’ VAT pricing debate, told Tribune Business that Super Value’s 2017 top-line had seen a marked decline in comparison to the two years prior, during which time the food store chain had used VAT ‘exclusive’ pricing.
“Sales have not been as good this year. Sales have been dragging this year. For almost two-and-a-half years we sold goods with VAT non-inclusive pricing.
The Government made us switch to VAT inclusive pricing and our sales fell off; our growth rate fell off 10 per cent ,” said Mr Roberts.
“Customers were paying, for example, $2.99 for a cantaloupe, and when they made us include the VAT in the displayed price that went to $3.21. Customers saw the $3.21 and thought they still had to pay VAT at the at the register; perception is reality. They figured our prices went up 7.5 per cent. We didn’t see the sales and Government didn’t get the VAT.”
Mr Roberts said he plans to appeal to the Government over the issue. The Government’s original VAT legislation, released in November 2013, had opted for ‘exclusive pricing’ where the product price and amount of due tax were shown separately on the label. It then reversed this position in the legislation that passed through the House of Assembly.
Groups such as the Bahamas Federation of Retailers (BFR) and the Coalition for Responsible Taxation had lobbied the then-Christie administration to no avail to revert to VAT ‘exclusive’ pricing, with some arguing that uncompetitive ‘inclusive’ price comparisons would likely drive more Bahamians and tourists to shop in the US as opposed to locally.
The business community had been pushing for the New Zealand model, which mandated neither VAT ‘exclusive’ or ‘inclusive’ pricing. New Zealand only requires that merchants ensure that consumers have a complete understanding of pricing, and whether it includes VAT or not.
“We are going to go back at government and see if they will let us go back to VAT ‘exclusive’ pricing,” said Mr Roberts. “I think our sales will jump and the VAT we collect will jump.
“I think it’s a perception issue. We were selling corned beef at $1.97 and adding on VAT at the register. Then they made us price it at $2.11, and the customers believe they still pay VAT at the register. There is no question you can sell more without including VAT on the shelf. The public loved that for two years, and when they made us put the inclusive price on the product the complaints started and sales fell off.”
Mr Roberts added: “We were having a 10 per cent growth, and our growth fell to zero. The public wants the pricing the other way, and merchants want it the other way. If you go in Wal-Mart you purchase something and they add the tax at the register. I don’t see why we have to be contrary to the world.”
Comments
ohdrap4 6 years, 4 months ago
the people did not stop buying at supervalue because of the vat.
they stopped buying because their goddamn prices became too high and because they sell rotten fruit.
solomons sell the ground beef at 3.89 per pound and supervalue 6.44, vat or not, this is ridiculous.
fruits at solomons are better but they reduced the size of their display.
and hardly anyone buys at fresh market harbour bay.with so called organic grapes that cost an arm or a leg.
B_I_D___ 6 years, 4 months ago
Got nothing to do with VAT...Super Value stores are in TERRIBLE shape and over the past couple years a lot more competition has come online driving people away from their stores. Despite what they think, they are not the only show in town.
TalRussell 6 years, 4 months ago
I would've thought Super Values Chief Comrade Robert, should've known that when a store waits to add the VAT to the grocery shoppers bill at the cash register 'they going spend significantly more' every time they shop at a Super Value store when if the groceries tossed into the shopping buggy has the tax added to their shopping bill, only after they reach the checkout cashier. The vast majority Super Values steady shoppers for 'bread basket' items - can't even do basic arithmetic... and I get the feeling Super Value head office has some people working there who are pretty damn good at the arithmetic when it comes to how get shoppers toss more food items into them shopping buggies.
Chucky 6 years, 4 months ago
this is a bogus argument, it's simple put signs up that say vat is included, then there is no doubt.
The pie is only so big, employing vat gave the government a big new slice of the pie, obviously that slice came out of everyone else's share. It's really not that difficult to figure out. Sales had to decline with the implementation of vat.
TalRussell 6 years, 4 months ago
Comrades, VAT line item should always be shown at the cash register on your groceries bill for 'taxes' you're paying.
Conclusion: To remind shoppers how much the government is stealing of your money - every time the working poor and near poor is buying they's 'bread basket items' - the same items the red shirts promised they would no longer tax the working poor and near poor voters on. DAMN DA LIARS...Do not allow them hide their stealing ways.
sheeprunner12 6 years, 4 months ago
All Bahamians need to boycott VAT in 2018 ......... and make the Government stop being lazy and make better use of Treasury funds .......... bottom line Govt. problem is the excess public HR, public Corp. wastage, poor accounting practices, and contracts kickbacks........ FIX those things and we won't have had VAT in the first place.
TalRussell 6 years, 4 months ago
Comrades, our tourism dollars are likes a revolving door - 85 cents out ever dollar tourists spend in the Bahamaland will leave the country resulting in more working poor and near poor.
The_Oracle 6 years, 4 months ago
While I believe VAT aught to be shown separately on Bin/shelf labels, for the simple reason that the average Bahamian may start to understand the Government is the real cause of the high cost of living, his logic is flawed. Rather than try to do the bare minimum as required, do both? Knowledge is power, give your customers the cost break outs at every opportunity. Same goes for gas pump prices, it aught to be shown per gallon. Government can coerce, the private sector can convince!
ohdrap4 6 years, 4 months ago
i do not know what the big deal is. i have seen a number of merchants display tags that show both prices.
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