The Cabinet of Ministers will meet next Tuesday July 12 to decide on the prices of essential goods-and VAT will not be added to these items, said the Minister of Industry and Commerce Rishad Bathiudeen on 8 July in Parliament.
โThough the VAT component is applied to a certain commodities, no VAT component is applied for essential food itemsโ said Minister Bathiudeen, addressing the House.
Minister Bathiudeenโs statement is reproduced below in full:
โAn issue has been raised recently with regard to the price of consumer goods as the price of an essential commodities has been differed significantly from one district to another. This was happening during the past due to transport cost incurred and the number of middle men involved in the supply chain, however, now the consumers are of the view that this was recently happened due to increase of Value Added Tax (VAT) component. Therefore, these concerns should be addressed positively in order to maintain the Cost of Living in the country while ensuring delivery of quality goods and lowest price to the end consumer. I must highlight the fact that though the VAT component is applied to a certain commodities, no VAT component is applied for essential food items such as White Rice, Sugar, Dhal, Big Onion, Potato, Red Onion, Milk Powder, Wheat Flour, Dried chilies, Green Gram, Chick Peas, Canned fish, Sprats, Chicken, Pharmaceuticals. Especially, in Sathosa outlets, we are selling VAT free consumer essential food items as mentioned above. It must be noted that, items which VAT are not imposed, the price should be less. But when a price of a Thai sprats which is identified as good quality, one Kilo is at Rs. 530/- in Sathosa Outlets, it varied from Rs. 700/- to 850/- in general market. When it comes to remote areas price goes up to Rs. 900/-due to the intervention of the middle men. But I must emphasize here that no VAT is imposed on essential items. Therefore, the present pricing formula which is implemented by the Consumer Affairs Authority must be re-published and proper monitoring activity should be established district wise to monitor and raid. Therefore, my ministry will take immediate action to re-gazzete the Maximum Retail price (MRP) of the essential items and publish the maximum prices by electronic and printing media to the public and strengthen the market raiding mechanism. The Cabinet of Ministers will meet next Tuesday July 12 to decide on the prices of essential goods, re-gazetted. Accordingly, hereinafter, twice a week prices will be telecast through print media and electronic media. If maximum retail prices are not maintain in the market aggrieved consumer can lodge a complaint to the Consumer Affairs Authority which we have established in each and every district. And also special hot number that is โ1977โ has been introduced to lodge the complaints of the consumers. As announced at the Budget Speech, an also decided by the Cabinet meeting held on this week and also the special Cost of Living Committee chaired by the Hon Prime Minister, the government has decided to subsidize essential food items such as Sugar, Dhal, Big Onion, Sprats, Dried Chilies, Potato, Canned Fish, and Milk Powder with immediate effect if necessary. And government even subsidize certain essential items to maintain affordable prices to the consumers such as Canned Fish and Milk Powder. And also this week we discussed to strengthen capacity of the consumer Affairs Authority by employing 100 additional graduates. And also price control mechanism would be supervised district wise by senior ministers to ensure MRP will prevail. Another measure which we have decided to ensure control price is the increase the number of Sathosa out lets in the country. For the movement 319 Sathosa out lets are operating and provide significant support to the consumers. We are intending to increase it up to 500 out lets by end of this year. It will ensure the supply chain of essential food commodities to each and every remote areas of the country.ย And also the Hon Prime Minister advised to convene the Cabinet Sub Committee on the Cost of Living Committee on every Tuesday and to submit a weekly report on Cost of Living along with its recommendations. I firmly believe this proposed mechanism will ensure the control of price of essential goods ensuring the accessibility of the consumers to affordable prices. Accordingly, consumers can purchase these items from any market at the price set. This decision was taken by the government to overcome the present anomalies in the market while ensuring implementation of the promises given by the present government under the Leadership of H E the President and the Hon Prime Minister.โ
Leader of All Ceylon Makkal Congress