By Leiselle Maraj Tuesday, March 20 2007

Consumers may have to pay Value Added Tax (VAT) on computer printers and accessories and computer monitors at the moment, as international custom laws have been amended.

According to a senior official at the Customs and Excise Division, there has been an amendment to the harmonised system, which governs the classification of goods on a worldwide scale. “A lot of tariff numbers had been changed therefore VAT would be charged on certain computer hardware,” he explained.

He said Trinidad and Tobago Customs and Excise Division, as a member of the World Customs Organisation, has to comply with the harmonized amendment. These new measures, he said took effect since February 1. He stated though that an amendment to the local VAT Act would rectify the situation. Customs duties on all computer software and VAT on all computer hardware, parts, accessories and software were eliminated in October 1998 as part of the 1999 Budget presentation.

The customs official said he did not expect this temporary addition of VAT to drastically affect the price of computer printers and monitors.

Many computer stores and custom brokers though were unaware of this change. Gaston Alkins, operations director of Snikla Enterprises, said his company received a shipment of computer hardware last week and were surprised when they were charged VAT. “Our shipment was classified under televisions and not computers therefore we believe that this was a mistake,” he said.

He explained though his business was VAT registered therefore the company could claim for these expenses. This way the extra charge would not affect the current price of printers and monitors, he said.

One managing director of a major computer store looked at the indirect implications. “It may mean consumers would have to pay more for bank services and at other institutions which have to pay this tax but have no means of compensation,” she said.

She added she was only informed of this classification change late last week and it may affect other computer hardware as well.

Brokers at Huggins Shipping and Brokerage Limited and Lall and Company Limited Customs Brokers both said that there is a zero percent tax charge on computer parts and accessories for the past nine years.

VAT has been a hot topic in recent weeks as government removed the tax from selected basic supermarket items. Former Supermarkets Association president Balliram Maharaj last week called for government to create a policy regarding the future removal of VAT, reduction of duties or taxes.

In a press release yesterday, National Primary Schools Principals’ Association Public Relations Officer Trevor Oliver condemned some members of the business community who have not reduced the price of basic food items despite VAT removal.

The release stated, “the Association applauds the government for removing VAT on basic food items but the benefits of this move will not be realised without the co-operation of the businessmen and the constructive vigilance of the authorities.”