The Senate is still debating this year's budget before the inevitable ratification. But even before the 2004/2005 was budget was debated and eventually passed and sent to the senate late on Friday night, the new tax measures introduced at its original reading were already in effect.
The amendments to the sales tax act were first read Friday January 23rd, signed into law the following Wednesday January 29th, and by last Monday, February 2nd the tax increases and a few minor decreases were reality.
So what exactly has increased and by how much? Keith Swift went shopping and found out.
Keith Swift Reporting,
With the exception of those metal buckets and small refrigerators we keep hearing about - you can expect inflation on the Guinness "man haffu drink," the rice we Belizeans love to eat, and even the Tuesday Amandala Newspaper we need to read.
Say it isn't so! Wish I could but my personal grocer Ian Mendoza told me it is, and walked me through the price increases.
Ian Mendoza, Mendoza's Grocery
"A Guinness was $2.50 and now its $2.75. That's the recommended price unless you want to absorb the loss. The Belikin beer and stouts have also risen by 25 cents. Cow milk rose from $1.25 to $1.35. The chocolate milk rose from $1.50 to $1.75. Soft drinks should also increase but I won't do it. Rice also should increase. It was 75 cents a pound and is rising to like 85 cents. Everything is going up."
And it is not just food and drinks; Today's Tuesday Amandala rose 20% and now costs a full dollar. Expect also your cable bill to go up 1 percent - though cable providers plan to initially absorb the increase. And you might want to reconsider that new cell phone purchase since the tax has increased from 8% to 13%.
All around the trend is that you will be spending more. And president of the chamber of commerce mark Lizarraga says that people will buy less and spend more, which will hurt the business community.
Mark Lizarraga, President Belize Chamber of Commerce
"We have said that it is going to reduce the purchasing power of consumers. Whenever government takes more money out of the system, the people have less money to spend on their own. That creates a crunch - we prefer for the consumers to have the purchasing power and not the government."
We admit there are places you can still find a Guinness at a bargain for $2.50 or rice at the old price of 75 cents. Mendoza is one such grocer and he says he will try to absorb the increases, as long it doesn't hurt his bottom line.
Ian Mendoza,
"It is very important for the survival of a shop not to raise your prices very quickly because someone coming in might not have heard the news on the radio so as a shopkeeper we have to absorb until its well known."
But Mendoza is the exception to the rule so your best bet is carry some extra change the next time you head to the supermarket.
We note that there is no sales tax on rice however there is a price hike. Unrelated to the sales tax. Our industry source says the increase is flatly illegal and by law the controlled price of white rice is 75 cent per pound. Another unrelated increase is butane gas for which the national average rose by 4 dollars last week.
There has been a sales tax increase on gasoline though you won't feel it at the pump because while they increased the sales tax, government decreased the revenue replacement duty on gasoline - leveling out its take on every gallon for 7.35 at a robust 4 dollars 35 cents.