Grenada announces two monthly VAT-free shopping days under EC$18M relief package

Grenada: The Government of Grenada has announced a measure aimed at easing the financial burden, targeting the Cost of Living Assistance Programme designed to cushion households, businesses and the national economy against rising global food and energy prices.

The comprehensive relief package is aimed at addressing international inflationary pressures, including higher fuel tariffs, rising shipping costs and global supply chain disruptions linked to ongoing geopolitical conflicts in the Middle East.

Minister for Finance Dennis Cornwall said the cause is imported inflation rather than inflation created within Grenada and noted that while the government cannot control international markets, it can act responsibly to reduce the impact on citizens.

This is not inflation created in Grenada; it is imported inflation. While we cannot control international markets, we can act responsibly to help reduce the impact on our people, he said.

The initiative is expected to directly benefit more than 38,000 households nationwide and the programme will provide targeted economic relief while safeguarding the government’s commitment to long-term fiscal stability. The overall fiscal impact of the initiative is estimated at approximately EC$18 million.

The government will maintain existing price ceilings on gasoline, diesel, kerosene and LPG cylinders through December 2026.

Additional measures under the package include a full removal of VAT on electricity for all consumer categories, running from August to December 2026, and the removal of the Customs Service Charge on diesel imported for electricity generation, which is expected to lower the consumer cost of electricity.

The monthly electricity subsidy will also increase from EC$10 to EC$50. The eligibility threshold for the subsidy will expand from 99 kWh to 200 kWh per month.

Two VAT-free shopping days will be introduced each month from August to October, covering groceries, school supplies, hardware and appliances.

Cornwall said Grenada's ability to deliver the package rests on disciplined economic management. He said prudent fiscal stewardship in recent years has made it possible to provide meaningful relief now, while preserving the country's long-term sustainability.

We can provide meaningful relief today because of prudent fiscal stewardship over recent years. We are taking care of our people today while preserving the country’s long-term sustainability. That is responsible governance.

The Government of Grenada said it remains committed to the principles of good governance, fiscal responsibility and stability, in order to protect the livelihoods of citizens across Grenada, Carriacou and Petite Martinique.