Set fair prices!
With concerns being raised that the increase in the rate of the National Social Responsibility Levy (NSRL) will see some merchants engaging in price gouging to increase their profits, a Government Minister is warning them not to take advantage of the consuming public.
Minister of Industry, International Business, Commerce and Small Business Development, Donville Inniss, speaking during a recent interview with the Barbados Advocate, said that he was aware of reports, and had seen for himself, that the prices of goods at some establishments had seen high mark-ups, and this he maintained should not be the case. Moreover, he said while prices of imports will increase, that process should not be immediate, as the ten per cent levy is not to be applied to old stock.
“I would say to you quite frankly I saw an increase in the price of some goods before the NSRL kicked in and there are a few merchants that I have quietly spoken with about their practice. I have no doubt that there are a few merchants who have abused the system and who have jacked their prices up considerably, much more than one would expect as a result of the NSRL and we can only ask such merchants to have a conscience,” Inniss stated.
While expressing concern about the situation, the Minister admitted there was little the authorities could do, other than use moral suasion to encourage retail stores and supermarkets not to price their goods astronomically high, as there was no legislation in place that speaks to price gouging.
“We’ve looked at it at the Ministry and there really is no law that we have that would allow us to stop price gouging from occurring. In principle, once items are not under price control, companies are pretty much free to charge what they wish to charge. The Fair Trading Commission more looks at competition issues, except in a few cases, they cannot tell you what price to charge for items. So the answer is that our hands are tied in terms of being able to influence directly prices of goods and services in Barbados NSRL or not. But the power lies with the consumer who has an option of what to buy and what not to buy,” the Commerce Minister insisted.
He made the point as he said his Ministry has always sought to encourage competition, as that is one way of keeping prices as low as possible. Questioned then about whether the Department of Commerce would again be publishing in the press comparative prices of goods across various entities, the Minister said this was not something they were seeking to do at this time, though he did not totally rule it out.
“But I don’t think the State should be so heavily involved in promoting one enterprise over the other. The other thing is unless we know what are the input costs, which would vary from entity to entity, I don’t know if we can really weigh in on what the retail price of any item should be. Except that if an item is being sold in my supermarket for the last six months at $20 per unit and then on the eve of the NSRL, nothing else changes and that price goes to $30 a unit, I would say something is suspicious there unless you had an increase in the price from the supplier,” he noted.
His comments came as he noted that more than 300 items included in the VAT-free basket of goods, which includes basic food items would also not attract the NSRL which moved from two to ten per cent on July 1. Inniss said he supports this move by Minister of Finance, Christopher Sinckler and has pledged to do all within his power to ensure that his ministry together with the Ministry of Finance shares the information on that basket of goods as far and wide as possible. (JRT)