A planned reduction in the cost of 70 grocery items in Saint Lucia is now scheduled to take effect on August 1, following a one-month delay. Initially, the government had announced the change would begin on July 1.
“We’ve discussed with the private sector and they’ve asked us for some time,” Prime Minister Philip J. Pierre told reporters on Thursday. “So, probably from the first of August, we intend to see a decrease because the VAT on these items would not be there, on all the zero-rated items.”
The upcoming change stems from a government initiative to remove the 12.5% Value Added Tax (VAT) on key food items. The prime minister had revealed in June that the VAT reduction was set to apply to goods reclassified under the zero-rated category.
Pierre emphasised that while freight costs remain beyond the government’s control, the administration is using fiscal tools to make essential items more affordable.
“We don’t control freight costs,” he said. “What we control is the price, and I’ve outlined what we’ve done as far as the price of goods is concerned. The price of basic commodities – no service charge, no import duty, no VAT.”
In addition to removing VAT, the government has lifted a 6% service charge on selected goods and secured a waiver from CARICOM, allowing Saint Lucia to eliminate import duties on certain products.
To ensure that the tax savings reach consumers, the government says it will implement monitoring mechanisms to track price changes in the market.
Pierre reaffirmed this during the June briefing, saying, “Even if the cost coming into Saint Lucia goes up, the supermarket should bring the price down by 12.5 per cent. The government will be setting up our own monitoring to ensure that the consumer benefits from these reductions.”
Election coming