Premier Smith said the new duty on import policy is one of the measures implemented by Government to help address the high cost of living in the Territory.

The price changes expected on store shelves due to the new duty on import policy announced is not expected to be dramatic.

“The savings passed on will not be dramatic but I expect because of the change in the duties that the businesses would do more business and because of the very volume of business would be able to give better prices,” Premier Smith said on NDP Radio last evening February 6, 2012.

He further said the Trade Department would be monitoring through inspectors who will go out and visit the various businesses and will be able to compare the prices over a period of time. “Now what you have to understand is that any change that you expect will not happen overnight because most businesses would have inventories that last for maybe up to two months before you can see any changes coming in.”

This sentiment was supported by Minister for Communications and Works and businessman Hon. Mark Vanterpool who said that sometimes expectations from customers may be a “bit too high”.

“I think the idea here is to put a whole package together. This is part of your package put forward to spur the economy and so it is a very good initiative...It’s not going to be a dramatic drop. So the expectations should not be there but ultimately the community will get back between a million and two million dollars a year into their pockets but you wouldn’t see sudden big drops in your pockets but over a year you would see a million or two million went back to you off your prices...So you will be seeing a drop but expectations should not be that you will see a major drop in prices...it will be one or two cents, a dollar in essence.”

Premier Smith had announced on February 1, 2012 that effective that same day business persons importing goods into the Territory will see a reduction in their duty charges – as they will only be required to pay duty on Free On Board (FOB) costs as opposed to the previous practice of paying on Cost, Insurance and Freight (CIF).

He had added that it was one of the measures implemented by Government to help address the high cost of living in the Territory and expects lower prices being handed down to customers.

“So here is what we expect with this change in duty assessment. We expect that the savings to the local businesses will allow them to provide incentives and lower prices to the consumer. The 3.7 million dollars in revenue foregone by the Government of the Virgin Islands we consider as an incentive to local businesses that should accrue benefits very soon.”

He had also said in the effort to facilitate the success of this initiative, there will be joint supervision by the Ministry of Finance and the National Business Bureau, and the combined effects of its existence reviewed during the next 24 months.

However, the new policy would have to be put before the House of Assembly (HOA) for approval, which the Premier also acknowledged last evening. It is not clear how soon the bill would be taken to the HOA but this is expected to be done in haste given that the Premier had declared that the policy was to be effective February 1, 2012.