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#374834 - 04/28/10 02:38 PM The GST Police
Marty Offline
Whenever any new tax is introduced, there’s always the risk of crazy inflation – that retailers – only too eager to cream a little off the top will pass on the tax increase and then some to consumers who have really not many alternatives. And some say that’s how it’s been happening with the increase in General Sales Tax – which has forced the Dept. of GST and the Belize Bureau of Standards to conduct visits to retial outlets to ensure that the new rate is being fairly applied and that zero rated items are properly marked down. We accompanied them on one of those visits today.

Jim McFadzean Reporting,
Almost one month after it came into effect, the 2.5 percent additional tax on consumer goods is still proving a thorn in the side of both consumers and retailers. The government agencies charged with the implementation and enforcement remain short of manpower and resources, and so trying to get the bugs out of the system is proving to be quite a job.

Martin Rivas, GST Officer
"So far since yesterday we have had problems with the tax receipts. They are not properly structured. Because as a consumer when you come in to buy, you need to know what is taxable and what is not. So that is what we are enforcing, that the tax invoice, the tax receipt, is properly structured because you need to know that if the prices are taxed, you need to have a little T beside it, and if it is zero-rated, then you would have a little Z beside it to know what is taxable and what is not.”

Santiago Castillo, Jr., Director, Santiago Castillo Ltd.
“There are many grey areas, Jim, where they are not sure. Some vitamins will pay the GST, some don't, supplements, etc., etc. This thing just happened a month ago. The bugs need to be ironed out.”


Caught in the middle, as usual, is the all important consumer, who’s left bedevilled by the calculations reflecting the actual GST increase. And for a public not used to requesting a receipt at purchase, the task of keeping track of the lawbreakers is compounded by this behaviour.

Dr. Dennis Hoy, Consumer
“Some people look at their receipts very carefully. Others that don’t have very much money anyway, don't pay any attention because it doesn't make any difference one way or the other. It's six of one and half a dozen of the other.” Jim McFadzean
But do you find the receipts helpful?

Dr. Dennis Hoy
“The receipts are helpful to the government, because they are the ones collecting the taxes. It hardly does me any good. I can't get it off my income tax for sure. So what would be the use. Jim McFadzean
“This potted meat is one of the many items listed as zero rated and it is appearing on this list of Zero Rated Goods that is going to be provided to consumers by the GST office.”

Aside from potted meat, the list of Zero Rated Goods include food items such as unprocessed and processed foods, some household and agriculture items. While some medicines appear on the list, vitamins, like rice, have entered a gray area for both enforcing agencies and retailer.

Luis Cho, Bureau of Standards
"Part of the problem is that the person that is selling, is selling above the control price, which is regulated by government. The regulated price is $105/100 lbs. but in some cases they are selling at a $107 and above that, and that is wrong.”

Santiago Castillo, Jr.
"Right now for example one of our biggest suppliers sells us the 2lb rice, already pre-packed, pretty, ready to put on the shelf.”
Jim McFadzean
"And we are talking about locally produced rice?"

Santiago Castillo, Jr.
"Locally produced rice that we are buying from a local producer. We are buying that at $1.15/lb. and I showed the supplies people, my price this morning, my invoice. I am paying $1.15/lb for that rice. We have always known that that specific rice that comes pre-bagged is NOT controlled, only the bag one, the retail bulk one. That one costs us $1.15/lb because the bag costs us $2.30 which averages out to $1.15/lb. I can't sell it for $2.30 which would be $1.15/lb. We have to make a little profit on it. So we sell it for more than that. That is an issue that even they are not sure of."


So while the Bureau of Standards and GST collaborate in the difficult process of ironing out the bugs, Castillo says the Government of Belize is being cheated twice by those unscrupulous business establishments, which are under-representing their sales. The culprits are paying neither the business nor the GST tax. He says while it might be easier for the government to monitor and patrol larger outlets with more sophisticated technology in place, he believes there is an easy and straightforward formula to determine those medium and smaller businesses who are undermining the system.

Santiago Castillo, Jr.
"Government can easily take those that are paying their GST and say if a company of this size is paying their GST and is paying let's say for argument's sake, and we'll use a middle-sized company, Company ABC is paying $10,000 GST per month, how can a same middle-sized Company DEF only di pay $1,500 a month?"


Reporting for 7 News, I’m Jim McFadzean.

Consumers are reminded to request that a GST receipt be issued to them. The visits continue to other stores as well.

Channel 7

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#374841 - 04/28/10 02:47 PM Re: The GST Police [Re: Marty]
Marty Offline

General Sales Tax Unit checks receipts and shelves

receiptA number of business establishments in the city got surprise visits today from the GST Department and the Bureau of Standards. The spot checks were to determine if the businesses were properly implementing the tax increase. News Five’s Jose Sanchez found out who passed the test and got the reaction from customers.

Jose Sanchez, Reporting

Since April First the General Sales tax increased from ten percent to twelve and a half percent. The GST unit has been checking on businesses to see that the amended tax structure is properly implemented.

Martin Rivas, GST Officer

martin rivas

martin rivas

“We are out here checking the businesses to ensure the proper charges for tax taxable items are twelve point five percent. We have also included a list of zero rated items we are also checking that as well that those lists are not taxable.”

Jose Sanchez

“How many businesses are you looking at today?”

Martin Rivas

“Well today we have an estimate to visit about seven of them.”

The GST is not alone in the exercise. The Belize Bureau of Standards is also inspecting the quality of goods and services offered at the establishments.

Luis Cho

Luis Cho

Luis Cho, Technical Assistant, Bureau of Standards

“We’re checking that their scales are working accurately and their prepackaged goods are weighed correctly and that they are priced and labeled correctly.”

Jose Sanchez

“For a consumer who is just walking into a store and saying there is rice or sugar. How do he/she know it’s the standard?”

Luis Cho

“In this case what I would do, I would come to where the basic commodities are and I would select a couple of bags and I would look at the actual net weight. In this case it is marked on the package. And also has a label which says two pounds, this shelf would only have two pounds and the cost per pound. Here they have the cost for what is in the bag which is ninety cents for two pounds. In this case it would be forty-five cents per pound which is correct as is related to the price controlled regulation.”

During the morning, the team had visited Save-U and Bottom Dollar stores. Esther Mortis explained the nitty gritty of the receipts.

Esther Mortis, GST Officer

esther mortis

esther mortis


“A proper tax receipt should have the name of the business, their address, their TIN and the list of the items that you purchased and an indication if they are zero rated or taxable.”

Jose Sanchez

“The receipt in front of you for Save U, does it have everything you are looking for?”

Esther Mortis

“Yes this is a receipt that has everything. It has the items, the cost and an indication if it is zero rated or taxable.”

Jose Sanchez

“The businesses that you look at do they all have all these items that the customer should find?”

Esther Mortis

“The ones that have the point of sales system does. The ones that have the cash register we are still working with.”

Consumers are appreciative of the inspection exercise because at the end of the day, it’s their hard earned cash at stake.

Jose Sanchez

“Excuse me mam why do you prefer to shop at this store?”

Customer 1

“I glad to shop at battam dala to get a receipt on weh I pay tax pan and weh I no pay tax pan.”

Jose Sanchez

“Excuse me sir, what is your opinion about the GST department making checks at different stores?”

Customer 2

“As a customer I am glad they are making the checks so we can see what we are supposed to be charged for and how much we should pay.”

Jose Sanchez

“Is this something important for you as a customer and as a family person?”

Customer 2

“Well it is very important so we are not overcharged on items that we are not supposed to be charged for.”

Jose Sanchez

“Does it help you with making your own budget?”

Customer 2

“It helps a lot because the receipt has every item that you have purchased so you see where your money is going.”

Esther Mortis

“The customer bought Blue King Hand Sanitizer for five dollars. On the receipt it shows the breakdown of how much tax was in that five dollars which was thirty eight cents, twelve point five percent.”

Jose Sanchez

“So all customers should have a receipt that shows the breakdown?”

Esther Mortis

“Right, if the item is taxable it is indicated with the T and if it is zero rated it’s indicated with the Z.”

Though the Castillo group is up to par, other businesses need to improve their service and technology to show where each spent penny has gone.

Martin Rivas

“We have a problem with receipts because when the consumer comes in to come and buy, they need to know what is taxable and what is not. We are enforcing that the receipts are properly structured.”

Jose Sanchez

“Should there be a sign to say a sign to say an item is zero rated?”

Martin Rivas

“Yes, the receipts should have items that are zero rated and items that are taxable should have a little T to the side of the price to show that that item is taxable.”

Jose Sanchez

“If you come across a major infraction, is there a punishment, do you talk to the owner? What happens in those cases?”

Martin Rivas

“Okay, usually we give a verbal warning, then we give them a written warning. You know there’s always due process in everything that we do. So therefore, after we have done those then we take them to court because one of the things that we ensure as we walk into a store is we make sure that GST certificate is on the wall. The penalty for that is three to five thousand dollars if you are a registered taxpayer and that GST certificate is not on the wall.”

The GST and Bureau of Standards will continue to inspect a sample of businesses throughout the rest of the week. If your neighborhood store pays GST and does not have all relevant information on the receipt, that business should be reported. Reporting for News Five, Jose Sanchez.


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#374843 - 04/28/10 03:03 PM Re: The GST Police [Re: Marty]
elbert Offline
Definitely a lot of bugs and gray areas as they said.
The 'included in the price' thing seems to be a contradiction even in this article.
_________________________
The Dive Shops Daily Blog
http://scubalessonsbelize.blogspot.com/

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#374851 - 04/28/10 04:29 PM Re: The GST Police [Re: elbert]
Peter Jones Offline
I pity these enforcement agents, as they've been given an impossible job. There are so many vague and ill-defined areas that it would have been difficult to program any register for them even given proper time; this change was introduced so abruptly there is no way most retailers could have done all that was necessary. Even now, many retailers (let alone customers) don't know precisely what tax rate applies to any given item.

This has been introduced as badly as the original introduction of GST. Many importers lost thousands of dollars because of the way that was done.

Other than for a few specific items, there isn't any retail price control in Belize, is there? So these GST agents may see inappropriately raised prices, but so long as they're accounted for properly they have no powers to intervene, do they?

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