Confusion over cost of agrochemicals

Managing director of Caribbean Chemicals Joe Pires is accusing Finance Minister Colm Imbert of creating problems for local chemical importers by announcing the Government’s proposal to make approved chemicals and pesticides tax and duty exempt, beginning next January.

Pires said Imbert’s statement had led farmers to query chemical importers as to how much they were going to reduce the cost of chemicals, which they sold to agricultural shops.

Pires said he became perplexed and confused by Imbert’s announcement since duties and VAT on all agricultural chemicals were waived years ago.

“His (Imbert’s) statement has created a lot of problems for companies like us that import chemicals. Now farmers are asking us what is our new pricing and when are the prices coming down. But there has never been any duties or VAT on agriculture chemicals. I don’t know what the minister is talking about.”

In presenting the budget, Imbert stated that he would exempt from all duties and taxes inputs into the agricultural sector, including approved chemicals, pest control, approved vehicles, approved fishing vessels and equipment, which will take effect on January 1, 2016.

Caribbean Chemicals is one of the country’s largest chemical importers.

Manager of Carlsen Chemicals Ltd Kamal Hakim also admitted that farmers called his Carapichaima business to find out “what is going to happen now.”

Hakim said as long as he could remember there had been no duty and VAT on agriculture chemicals that came into Trinidad.

“That is the law.”

Pires said when VAT was introduced over 20 years ago by the then National Alliance for Reconstruction (NAR) administration “no VAT was put on agriculture chemicals. The government at the time realised that the cost of chemicals to the farmer would have amounted to 60 per cent of their inputs and labour. They needed to keep food prices down in order for farmers to be competitive.” 

In the coming days, Pires said, chemical importers would issue a statement to Imbert to clear the air on the matter.

“We are hoping that this issue will be addressed,” Pires said, “because it’s causing a lot of confusion with the importers.”

Price gouging

Following the budget, Pires said, he also heard that some agricultural shops had begun to increase the prices of chemicals.

Pires accused the shops of price gouging and “trying to make a fast buck” at a time when the country was facing a downturn in the economy and citizens were asked to tighten their belts.

Plum Mitan rice farmer Hansraj Ramlal said from Tuesday, a 110-pound bag of urea which he originally paid $200 for had increased to $225.

Ramlal said a three-litre bottle of Amine, a selective weedicide, which he uses on his 300-acre farm, had skyrocketed from $125 to $145.

Pires said these businessmen had no reason to increase their prices since chemical companies would deliver goods to their shops when an order was placed.

He said the owners were capitalising on the hike in the price of gasoline, which moved from $2.70 to $3.11 per litre, and of diesel, which increased from $1.50 to $1.73, and taking advantage of farmers.

“This is price gouging. This should not be happening. In most cases we deliver to the shops. We have not raised the prices of our chemicals even though fuel has gone up. And we have no intention of raising our prices. So why should they raise theirs?” Pires said he was willing to work with Imbert to help improve the agriculture sector.

Parliamentary Secretary in the Ministry of Agriculture, Land and Marine Resources Avinash Singh said Government was considering importing some environmentally safe chemicals that are already on the approved list by Customs and Excise Division.

Singh said other countries that sold these chemicals imposed duties and taxes, which Imbert would waive for the buyers and importers.

Taken from Guardian Trinidad and Tobago