There’s
a measure of anxiety among many “Ti Boutique” operators in Choiseul. Whether
tis anxiety is founded or unfounded, I don’t know but they believe that their
days are numbered and they blame it on VAT.
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| TI BOUTIQUE IN MORNE SION |
They
claim that with the introduction of VAT, the cost price of “VAT-able” items may
exceed the selling price; and because they are not VAT certified, they may not
be able to recuperate their losses and that may spell disaster for their
business.
So,
in those circumstances, they ask: what do we do? Will we be forced to close
down? Of course, although these are largely theoretical, their anxieties may be legitimate!
Background
Choiseul
is unique and known for its exquisite geographical layout – starting from the
Forest Reserve, the 12.1 square mile piece of earth slopes moderately and rolls
westward into the Caribbean Sea, spreading out gradually at an angle of roughly
30 degrees; but it’s not the “spread” or the “slope” of the landscape that
makes it unique. It is the ridges and their gorgeous “anatomical configuration”
which perhaps makes Choiseul a sight to behold.
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| MAP OF CHOISEUL |
If
we have had the opportunity to look at Choiseul from any angle, we may perhaps
realize that it can compete with the Grand Canyon, the Great Wall of China and
even the hanging gardens of Babylon and herein its hidden tourism potential. A
thought that Dunstan St. Omer and perhaps Derek Walcott may well agree with.
The
17 ridges which make up (what hard-core patriots refer to as) the “smallest
continent in the world” spread out like a voluptuous “perspective” into the
Caribbean Sea. An aerial or hilltop view
makes the sight not just even breath-taking but equally therapeutic, capturing
the velvety green canopy of vegetation which makes the configuration look as nearly
as beautiful and as sexy as lady Tulisa.
But
despite all those heavenly characteristics, crunch time may now be approaching!
What will be the fate of the Ti Boutique sector in (what a son of a patriotic
son of the soil and lawyer Huggins Neal Nicholas once described as) “nature’s
seventh heaven”?
With
an unenviable Basic Needs index of 13.1, the district’s poverty ranking paints a
sorry picture of our socio-economic conditions on the ground; and although we
are a people living on a landscape approaching a heavenly bliss (as suggested
by Nicholas), we nonetheless remain a quintessentially poor people searching
for a better way of life; and the statistical projection is things are on
course to become even worse for the Ti Boutique sector!
Ti Boutique: a major commercial feature
Because
of the district’s geographic and demographic configuration, the proliferation
of the Ti Boutiques across the ridges has become a permanent economic feature
of Choiseul. These small shops offer a variety of essential grocery items and
credit to their clients. They are partly tradition; but they are also absolutely
necessary “commercial” units and are particularly indispensable in the remote
hinterland communities (such as of Derriere Morne (Franciou), Ravineau, Bois
d’Inde, Delcer, Industry, La Pointe, Mongouge, Morne Sion, Martin and Fiette).
Moreover,
they have proven to be vital in times of extreme weather and when natural
disaster strikes the western communities are cut out from “civilization”
because of the overflowing Trou Marc, Sabre Wisha and Trou Barbay rivers; and the
Victoria and Belle Vue landslides which render any passage out impossible.
It
is under those circumstances that the Ti Boutique – just like the health
centres, schools and cooking gas outlets - becomes absolutely indispensable in
ensuring at least “temporary survival” of the natives.
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| LORNE CHATS WITH A FORMER TI BOUTIQUE OPERATOR |
In
that context, the Ti Boutiques form an indispensable part of any disaster
preparedness and vulnerability-reduction strategy for the district; and in the
same way that the post-colonial authorities saw the relevance of “decentralized”
essential services like health, education and energy to those vulnerable
communities, our government should move in and do the same for the post-VAT survival
of the Ti Boutique.
The case of the Ti Boutique operators
VAT
is a tax on business transactions; it is not
a tax on profits. VAT is charged at 15% on most supplies, though some are
either zero-rated or exempt. VAT is levied at two stages: Input and
Output. Any VAT paid by businesses on
their purchases is called 'input VAT'. The VAT charged by VAT-registered
businesses is called 'output VAT'.
If the Output Tax (on sales) is greater than
the Input Tax (on purchases), then the difference must be paid to Inland
Revenue Department or Customs. On the other hand, if Input Tax exceeds Output
Tax, then Inland Revenue Department or Customs will make a refund of VAT to the
business.
Therefore,
while VAT-registered businesses are able to reclaim the VAT that has been
charged by other businesses as ‘input tax’, the non-registered small shops
can’t and that may have implications for the latter’s survival.
The
big questions are: Will the statutory configuration of VAT displace and
ultimately wipe out the Ti Boutiques in Choiseul? And if that were to become a reality,
then what will be the social and economic implications? What will eventually
become of that sector? Has government considered them as potentially vulnerable
and what policies have been put in place for their sustainability or survival?
From
the look of things, it appears – at least theoretically – that the Ti Boutique
sector may have a case.
Unfortunately you have not factored voluntary registration in your analysis that would afford the small proprietors the avenue to reclaim the input tax. The VAT that an unregistered retailer pays becomes a business expense and the retailer will need to incrementally increase selling prices to cover this expense.
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