Gabon Suspends VAT on Staple Goods to Cushion Price Shock

The government of Gabon has resolved a 6-month suspension of the Value-Added Tax (VAT) on cooking oil, both imported and local fish, milk and flour to ease the skyrocketing price of staple goods, a statement said on Friday.

The move which follows a cabinet meeting on Thursday, will cause a loss of profit worth 10 billion CFA francs to the State’s budget, the cabinet meeting’s statement stressed.

The government decision also granted a 37 percent reduction for the legal Gabon-based fishery companies on the fishing oil price, from 470 to 297.84 CFA francs.

A commission will be set up to draw the list of registered ship-owners, the document added, stressing that the fishery companies have to land their catch in Gabonese ports and reduce substantially the price of fish.

The local press noted that the price of fishes captured in Gabonese waters doubled months ago, and ship-owners explained such hike by the soaring fuel price since Mars 2007.

For the rice, the government pegged the profit margin at 10 to 6 percent for importers and retailers.

In its statement, the government announced the removal of special taxes which the traders term “racket”.

The government ordered the Customs office, the Gabonese Council of shippers (CGC), the transport and agriculture ministries, and the other relevant institutions in the tax collection operation.

On last 22 April, the Coalition fighting the high cost of life in Gabon held a maiden march against the price hike in the country. The police however dispersed smoothly the hundred protesters gathered for the march.

As an oil-producing country in the Gulf of Guinea, Gabon lacks a sound agriculture policy.

According to the UN Food and Agriculture Organisation, the country spends each year about 150 billion CFA francs to import food products.

Source African Press Agency

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