Consumers across New Providence stormed shops in droves on Saturday, stocking up on various products before the value-added tax (VAT) increase took effect yesterday, which marked the beginning of the new fiscal year.
VAT rose from 7.5 percent to 12 percent just over a month after the tax hike was announced in Parliament.
Ricardo Neeley and his mother Jean Neeley were among those shopping at Kelly’s Home Centre.
“For me personally, I really wish that we were given more time, so at least more Bahamians could adjust, especially in the business area because when you think about it, it affects everybody, not only the businesses but also the consumer,” Mr. Neeley said.
He suspects the VAT increase will cause Bahamians to budget more.
“I really feel that for persons who are not conscious in their spending, it will actually raise an awareness even more for us to be responsible in our spending because we really have to now count our dollars and cents,” he said.
Mrs. Neeley simply noted that there was no need to worry as long as the country looks to God for help.
Tonya Bowe, a mother of four, said she took the opportunity to buy back to school items for her children at the 7.5 percent rate.
“I was freaking out when I first heard it but after that, it is what it is and we got to do what we got to do,” Bowe said.
For Doreen Cockburn, a retired hotel worker, passing up the chance to save a little bit of money, even 4.5 percent, was not an option.
Cockburn said her family was in need of a new microwave, so she felt it best to get it on Saturday, instead of having to pay the higher tax.
“It’s important because whatever savings at this time that you can accumulate for yourself, then that’s what you need to do,” she said.
“And if it means that 4.5 percent difference on an item, then yes, that’s what we do.”
Jerome Cartwright, a manager at Kelly’s Home Centre, said the store was busier than it normally is on a Saturday.
Cartwright said the Kelly’s system will reflect the increase today.
Asked if the company expects a decrease in business due to the VAT hike, he indicated there was no way of knowing.
“After the 7.5 percent we didn’t fall off, so we just have to wait and see,” he said.
While many people saw the weekend as an opportunity to stock up on supplies, others doing their regular weekly shopping said the VAT preparation was unnecessary.
“It is like a hurricane,” said Kadra Johnson, as she looked for detergent on the near empty shelves of Solomon’s Super Center.
“I was in here earlier and I kid you not, I had to turn around and I left.
“I tried to get in Super Value and it was crazy.
“I’m here now and the shelves are clean basically.
“It’s overwhelming but I still need to get my shopping done.”
Johnson said she understands why some feel the need to frantically prepare for the increase, even though she does not agree with it.
“People are afraid,” Johnson said.
“Maybe [the government] could have gone up a little bit on VAT, but not a whole bit.
“People are in fear of it and they are taking advantage of it and they are going to do what they do best.
“When my insurance company called me Tuesday to inform me that our already $512 insurance will be affected come July 1 by VAT, I was like Jesus take the wheel.”
Johnson said she already had to downgrade her insurance package just to keep the plan, because of the many financial demands she has.
“Shopping is going to be impacted, insurance services are going to be impacted, everything is going to be impacted,” she added.
“I really feel for the much less fortunate. I feel for them wholeheartedly.”
Trina Morley, who was also doing her weekly shopping in Solomon’s, said attempting to beat the VAT increase made no sense.
“When you already spend up a lot of money and you buy up a lot of stuff, how long is that supposed to last you?,” she asked
“And then you still have to come back in the shop and spend a bunch of money, whatever the VAT is.”
Morley, a mother of one and owner of Morley’s Catering, said she does not approve of the increase but will have to make it work with both her business and her home life.
“It will be a very big struggle for me because I run my own business and things have gone up, so I have to go up on my prices as well,” Morely said.
She added that she is not sure what will happen to her clientele, but insisted that she will have to make it work the best way she could.
Elizabeth Thelamour called the mad rush ridiculous.
“It’s ridiculous because meat does not last forever and there’s no meat in the stores,” Thelamour said.
“What if electricity goes off? You have all of that spoilage.
It’s unnecessary because it starts tomorrow. It’s inevitable.”
Mark Moxey, an accountant, said while he thinks a lot of the shopping has been impulsive, he hopes that Bahamians become more fiscally conscious.
“I think a lot of people are thinking that they are going to beat the 12 percent or the 4.5 percent increase; however, I think some of the prices have already changed,” Moxey said.
He said he has already seen a hike in prices on some of the items he usually buys in the food stores.
“I’m hoping that people are fiscally responsible and they don’t spend all of their money and they are able to manage for the next 30 days,” Moxey said.
“But just like everything, you’re going to hear uproar about it and people are going to get used to the 12 percent increase in VAT.”
Education: Vrije Universiteit Brussel (University of Brussels), MA in Mass Communications