St. Kitts and Nevis: PM Drew slams merchants for unfairly rising amid VAT reduction

St Kitts and Nevis: Prime Minister Dr Terrance Drew slammed merchants for unfairly raising prices after the government reduced VAT from 17% to 13%. The VAT reductions took effect from January 1, 2025.  

Speaking at the roundtable discussions, PM Drew stated as per allegations some merchants increased the base prices to offset the VAT reduction. He called the practice by the merchants of “depriving the consumers of the intended savings”. 

Notably, he emphasized that the VAT reduction policy is aimed at providing direct relief to the locals while stimulating the economic growth. The new VAT percentage will remain in effect until the first six months of this year.  

PM Terrance Drew also outlined that the traders could benefit from increased sales, as the VAT percentage gives consumers more purchasing power. 

Meanwhile, to curb the practice of price gouging, the Inland Revenue Department has provided clear guidelines on executing the VAT reduction. The transactions will be subject to the new 13 percent VAT rate under several conditions including when goods or services are delivered, completed or made available or when an invoice is issued and when payment is received.  

While encouraging everyone to follow proper guidelines related to VAT, the Prime Minister said that this VAT reduction represents the government’s steadfast commitment to enhance the quality of life for the people. He added that by reducing financial burdens on families and businesses, the government is taking a tangible step towards a more prosperous future for St Kitts and Nevis.