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Tuesday, April 23, 2024

Restoring tax on rice will only worsen matters – Trade minister

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By Tabora Bojang

Trade Minister, Seedy Keita has stated that government has no plans to re-impose import tax on rice products, amid calls that the measure has not made any difference in controlling the price of basic commodities.

In 2018, government reduced import tax on rice to 0%, a measure aimed at providing relief for Gambian consumers as well as contain the high prices of rice.

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However, the public has complained that the cost of imported rice has not gone down with many calling for it to be scrapped.

Speaking to journalists at a press briefing yesterday, Minister Keita warned that any decision to re-impose tax on rice importation could further pose dire economic harships on the lives and livelihoods of Gambians.

“Bringing back these tariffs will only add to the current cries of the citizens. We all know the price of a commodity is determined by a number of variables which include duties, exchange rates, freight cost, and other local factors. So it is not accurate to say consumers [citizens] have not benefited from the tax waivers just because the price of rice has not gone down.  Maybe people were looking at it [price of rice] below D1000 but these items are purchased in dollars and inflation is an inherent part of any economy,” minister Keita argued.

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He further revealed that even though the government understands the concerns of the people towards the tax waiver on rice imports and its perceived consequences, re-introducing it will mean higher consumer pricing.

According to him, government has also taken into context the great discrepancies in the price of basic commodities in The Gambia compared to the other sub-regional counterparts like Senegal.

He also made comparison of market prices in The Gambia and Senegal: “A bag of rice costing D1300 in Gambia, is sold at D1679 in Senegal; a bag of sugar costing D1406 in Gambia is sold at D1485 in Senegal; a bag of flour in Gambia costing D1300 is sold at D1581 in Senegal and while a cooking oil in Gambia costing D1425 is sold at D1854 in Senegal.”

Price controls

The Trade minister also stated that 80% of hike in prices in the country are caused by external factors though there also exist some internal factors including a GMA levy on freight costs, structural problems at the GPA and the introduction of a new registration fee by the Food Safety Authority.

However, he said the government will continue to maintain a “liberal market and as such, it will not resolve business men to be subjected to state directives” in determining prices of their products.

 “If anybody charges you a price you are not happy with, you are not obliged to transact because this is a free market. We want to make the market set the tone and correct the consumer behavior but we will not come with a heavy hand and impose prices on commodities.  Everybody in a free market is a price checker, which is why we want the citizens to be rightly informed so that they will not be taken advantage of by the retailers,” Keita added.

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