The Barbados Manufacturers’ Association (BMA) has released a statement in response to the removal of the National Social Responsibility Levy (NSRL).
Below is the full text of the release.
“Barbados Manufacturers’ Association urges Barbadians at home and abroad to work as a team to rebuild Barbados, as government commences the implementation of recently announced budgetary measures.
As the removal of the National Social Responsibility Levy (NSRL) takes effect the Barbados Manufacturers’ Association is indicating that various companies will be affected differently as a result of the abolition of the tax, and urges consumers to have a level-headed reflection on budgetary measures and set price expectations based on what drives cost.
The Association is cognisant Government’s only intention is to rebuild the country, however the presumption that there will be a sharp decline in prices must be debunked. A ‘one size fit all’ prediction in the drop of prices should not be used given that various factors are impacting cost, from business to business.
While a rate of NSRL was charged on the price of the imported goods at the port of entry it was charged on the production cost for local manufacturers. Production cost refers to the sum of money that has to be spent to manufacture goods. Such costs include a variety of expenses including water, labour, fuel, raw materials and general overheads.
Given that the removal of the NSRL does not reduce production cost and production cost vary from company to company it is difficult to predict ‘blanket drops in prices’. For example, raw materials are influenced by oil prices which are increasing, any increases in freight also escalate production costs and additional payroll costs from NIS increases will have an impact. All of these factors will influence the final price of a product.
More importantly, the Barbados Manufacturers’ Association is calling on each Barbadian and friends of the country to support local producers and service providers as they navigate the challenges ahead.” (PR)
