Chair­man of the Con­fed­er­a­tion of Re­gion­al Busi­ness Cham­bers, Vivek Char­ran, has called on Gov­ern­ment to con­sid­er an ad­just­ment to the Val­ue Added Tax sys­tem as a means to ad­dress in­fla­tion­ary pres­sures.

He not­ed that the gov­ern­ment’s in­abil­i­ty to con­sis­tent­ly pay out re­turns to busi­ness has had an ad­verse im­pact on many busi­ness­es.

Char­ran said, “What we are see­ing is the Gov­ern­ment is find­ing it dif­fi­cult to han­dle their part of the oblig­a­tion which is the pay­ment of VAT re­turns. Now the sit­u­a­tion is that Gov­ern­ment has said it was go­ing to pay the VAT re­turns that were due be­fore. When is that go­ing to be paid?”

Char­ran said that giv­en the fact that gov­ern­ment has strug­gled, he has sug­gest­ed that VAT not be used as wide­ly, and a busi­ness im­ple­ment­ed sales tax be pro­posed in­stead so that the fi­nan­cial bur­den would not be placed on the gov­ern­ment.

“Be­cause the gov­ern­ment doesn’t have to pay the sales tax, it will be a di­rect tax,” said Char­ran,” What we are look­ing at is ways in which we can re­duce the lev­el of in­fla­tion in the coun­try. One of them is if we say we re­move VAT and put a less­er sales tax.”

He said par­tic­u­lar­ly as it was al­so dif­fi­cult to raise salaries cur­rent­ly, find­ing ways to re­duce prices paid by con­sumers would pro­vide a re­lief to the pub­lic.

On this note, he not­ed that an ad­just­ment on the min­i­mum wage would be a bur­den on both the busi­ness com­mu­ni­ty and the gov­ern­ment.

“We be­lieve that the Gov­ern­ment has a lot of work­ers and a lot of peo­ple to pay and their re­cur­rent ex­pen­di­ture is al­ready high. So them tak­ing on the bur­den is one thing. Busi­ness­es on the oth­er hand, now, we have to take on the bur­den of say­ing we are go­ing to pay more at the very base lev­el. If you in­crease the base lev­el and all the oth­er lev­els above that should al­so be pro­por­tion­ate­ly in­creased to a cer­tain de­gree. Cor­rect? The re­al­i­ty is we have no prob­lem do­ing that in an econ­o­my that is grow­ing and do­ing bet­ter than it is now. The re­al­i­ty is that we are one year or two years away from what hap­pened dur­ing the COVID pe­ri­od and many peo­ple are still in debt,” said Char­ran.

He said based on this, the fo­cus for the Gov­ern­ment in the up­com­ing bud­get should be ad­just­ing tax­es and du­ties on prod­ucts which could give the pub­lic greater spend­ing pow­er.