Minister of Finance Camilo Gonsalves said the government has proposed to reduce the kilowatt-hour (kWh) threshold for VAT on electricity from 200kWh to 150kWh.
Minister Gonsalves said, “This means that all VINLEC domestic customers who consume 150 units or more monthly will be required to pay VAT.
With the lowering of the VAT threshold to 150 units or more, just 36.0 % of VINLEC’S domestic customers will now pay VAT. “
Minister Gonsalves added, “St. Vincent and the Grenadines is one of few CARICOM countries where VAT is not paid by domestic customers consuming 200 units (kWh) of electricity or less.
” He further opined, “That as consumers continue to implement more energy efficient measures in their households the level of electricity consumption would decline thus reducing the number of domestic customers who will fall within the VAT threshold.”
The introduction of VAT on Electricity is expected to provide an estimated $1.0 million in additional revenue annually to the government.
This new measure will take effect on May 1st, 2018.