St. Kitts and Nevis Government Implements Comprehensive Measures to Mitigate Effects of Rising Costs of Living
BASSETERRE, St. Kitts, June 30, 2022 (Press Unit in the Office of the Prime Minister) – With a number of external forces continuing to drive up the costs of living, the Government of St. Kitts and Nevis has implemented a number of measures aimed at mitigating the negative effects on its citizens and residents.
These measures were outlined by Prime Minister and Minister of Finance, Dr. the Honourable Timothy Harris on Wednesday, June 29 during a Cabinet Press Conference held at the NEMA Conference Room.
Prime Minister Harris said, “In pursuing a policy of mitigating the cost of living, we were mindful that many families had yet to recover from the effects of COVID-19, and a critical part of our 2022 Budget approved by the Parliament involved the extension of several elements of relief to our people.”
A number of the relief measures were extended from previously announced stimulus packages. These include the waiver of payments for the consumption of water for individuals who have been laid off or have experienced a reduction in earnings as a consequence of COVID-19; the waiver of payments for the consumption of water by farmers; the removal of VAT and Import Duty from selected hygiene items; the removal of Import Duty and Customs Service Charge on selected items including vegetables, fruits, fruit juices, cough and cold preparations and vitamin supplements; the reinstatement of the annual Import Duty exemption for 16 tires (4 tires per quarter), 4 pairs of brake pads and 3 pairs of brake shoes for “H” passenger buses, and the re-introduction of the duty-free allowance by non-commercial importers for a six-month period ending September 2022.
Dr. Harris said, “The elements of relief are consistent with our efforts to protect our people from spiralling cost of living caused by forces external to us, like the Russian/Ukraine war which has triggered a shortage of energy, agricultural inputs, food, etcetera and subsequent high prices. My government has responded to bring relief to our people and ease their hardships.”
As part of its response, the Government has reduced the remaining duties and taxes on the ingredients required for the production of $2.00 bread for a period of six months and placed an eight-month cap on the freight cost that is used in the calculation of duties and taxes that are paid on the importation of goods for 20 and 40 foot Dry and Reefer Containers.
Moreover, the reduction of Corporate Income Tax from 33 Percent to 25 Percent for businesses that retain 75 percent of their employees continues as well as the reduction of Unincorporated Business Tax from 4 percent to 2 percent.
“The cost of fuel continues to be a challenge. What has the Government done? The Government reduced the excise tax on fuel from $2.25 to $0.95—a significant reduction. In other words, we gave up tax revenue in order to contain the cost of fuel,” the Prime Minister added.
A number of critical programmes such as the Poverty Alleviation Programme, SAFE, SELF, Income Support, the Disabilities Support and the Fuel Subsidy Programmes will all continue.
The Government has also put measures in place to ease the pressure of electricity costs on residential customers.
Prime Minister Harris said, “We were concerned that too many persons had had their electricity cut and the Cabinet determined that we will put an end to this denial of electricity to residential consumers, and so we placed a hold or moratorium on the payment of electricity arrears and we have in fact waived the fee for the reconnection of electricity all with the view of our people getting again lights in their homes. We could not continue the policy of putting families in darkness. The shame and agony surrounding this were not consistent with the compassionate society my Government encourages.”