People can now report to the Competition and Consumer Affairs Authority or the erstwhile Office of Consumer Protection, if they observe an unusual hike in the prices of essentials including cereals, cooking oil and milk powder in the market. The office issued a public notification stating that the sales tax and customs duty of about 140 goods have been reduced with the enactment of the Tax Act of Bhutan, 2022. This is expected to ease inflationary pressure in the market.
The prices of cereals, pulses, cooking oil, milk powder, agricultural spare parts, and seeds are expected to decrease following the reduction in sales tax and customs duty.
For instance, the price of Everyday milk powder which currently costs Nu 419 is expected to reduce to Nu 377 after the removal of the 10 per cent sales tax on it following the implementation of the Tax Act 2022.
In the notification, the Competition and Consumer Affairs Authority urged businesses to refrain from unjustifiably increasing the prices of these goods.
Although the office has issued and shared the notification on its official Facebook page, some consumers and business owners are unaware of it. Some consumers even said they haven’t noticed much difference in the price of these goods in the market.
“Regarding the prices of goods, the price of oil has gone down but the prices of other goods might have increased instead. I have not seen much reduction in the prices. The prices are still high for other goods except for the rate of cooking oil,” said Tshering Penjor, a customer.
“I did not notice much reduction in the prices for goods. The price of rice has been reduced by a bit but the prices for other goods are the same. When we asked the shopkeepers if the prices of goods will be reduced, the owner said that he had not heard about it,” said Namgay, another customer.
Meanwhile, some shopkeepers say that they sell the goods at the prices they get from the wholesalers or importers, which is inclusive of the tax. They added the reduction in sales tax and customs duty is not going to make a huge difference as the prices of goods have been increased from the source itself. And some said they are currently selling the old stocks meaning that the consumers will be paying the prices inclusive of the taxes.
“Some customers are aware that the prices of goods have been increased from the source itself. Some accept the increase in prices because they say that prices are increased with the increase in tax. However, some customers also think that shopkeepers have increased the price of goods,” said Thinley Gyem, a shopkeeper.
Besides the ambiguity, the notification has sparked curiosity among some regarding the specific reduction in the prices of the goods.
To this, the office, on its official Facebook page, clarified that the government does not fix the prices of goods in the market adding that it is determined by the demand and supply of goods in the market.
Although the office takes complaints and queries from the public, the Ministry of Finance frames the tax, and the Department of Revenue and Customs implements and monitors the sales tax and customs duty.
The 8th session of the third parliament passed the Tax Act of Bhutan 2022 last month.
Edited by Phub Gyem
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