Manufacturers petition Govt. to remove VAT on forest products

Last Updated on Tuesday, 25 April 2017, 12:27 by Denis Chabrol

The Guyana Manufacturers and Services Association (GMSA) has launched a petition against the implementation of the Value Added Tax (VAT) on Forest products—a move that has since increased the cost of production locally and causing local products to be unable to compete with imported products.

The petition is currently affixed to saw-mills, lumberyards, community shops and GMSA Headquarters on Waterloo Street, among other locations, as the grouping looks to garner support to reverse the application of VAT on forest products, which took effect on February 1 last.

According to GMSA, the imposition of a broaden VAT base on the forest products, “could not have been more untimely for the sector.”

GMSA in its petition says the imposition of VAT “has effectively raised the cost of our products locally, thereby giving imported substitute products such as pine, plywood, doors, plastic panels, medium density fibre (MDF) boards and other flat panels, a stronger advantage against our locally produced forest products at the expense of losing jobs and going out of business.”

GMSA in its appeal is adamant “forest products are considered some of the greenest products when compared to any other substitute products available on the market and is a positive contributor to the Green Development Strategy that the Government is currently promoting.”

The local manufacturers’ umbrella body says, the forestry sector currently supports 17 per cent of the population directly and indirectly through job employments and other opportunities and experienced its lowest production in 2016.

GMSA in its appeal for support to have government repeal the imposition of VAT on forest products “will affect loggers, workers, building contractors, homeowners, furniture manufacturers, saw-millers, crematorium, lumber yard operators, shop-owners, logging dependent communities including Amerindian villages, plywood manufacturers, hardware retailers and even miners that depend on logging roads to access their mining operations among several other stakeholders.”

Forest products that have since February 1, 2017 begun attracting VAT includes, logs, shingles, staves, lumber (rough and dressed), piles, poles, posts, spars, veneer, plywood, charcoal, firewood, wattles and manicole palm.

contributed by Gary Eleazar