Mark up or VAT?

That will have to wait for at least another two weeks when the last minute rush for school texts happens.

Therefore, it is relatively easy to catch the attention of employees.

Business Day hands over a book list at several bookshops around Port of Spain. We want to know the prices as well whether they are VAT inclusive.

One attendant smiles shyly, but looks slyly across at a colleague before answering. There are VAT compliance officers and Education ministry officials about the town and they are not sure who we are.

“I think the VAT is already there in the price, but I’m not sure.” At another store, they charge no VAT.

“We haven’t for the longest while,” said the manager. And still, at another store, the question is answered unequivocally, they charge VAT.

The parents seem resigned.

Recession or no recession, VAT or no VAT, the books must be bought because their children need an education. We see the same ones at multiple bookshops, perhaps searching for a bargain. It makes sense to look. For one of the books on our list, there is a $20 price difference between two bookstores, attendants at both stores telling Business Day that they charge VAT. Now, with the free textbook programme suspended and the re-imposition of VAT across many good and service categories, parents’ hands are inching deeper down into their pockets.

Zena Ramathali, President of the National Parent Teacher Association said while she received no specific complaints about book prices or the level of VAT on school books this year, the purchase of school texts has always represented a financial strain on parents’ wallets.

She acknowledged that it seemed over time, the amount parents were spending on school texts seemed to be trending upward. This, despite many measures taken over the years to keep textbook costs low.

The first Manning administration introduced the school textbook programme and the People’s Partnership removed VAT on many items during its tenure, including several school related items.

Moreover, one bookseller we spoke to said there was a fixed mark up by which stores can sell over the publisher’s price. This is enforced by the Ministry of Education.

Why the inconsistencies in VAT application among sellers then? And why, after measures by successive governments to keep book prices down books appear to be getting more expensive? Rico Charran, President of the Booksellers Association told the Business Day that a public misperception is responsible for the idea that VAT is being charged on school texts and that prices are increasing.

For instance, there is no VAT on the vast majority of school books and there has never been, said Charran.

Charran, whose family has been in the book selling business since 1974 said there was an attempt when VAT was introduced to make school books vatable, but this was stopped. He chalked the claim made by some of the employees at the bookshops we visited that there was VAT on texts to the fact that the stores tended to take on extra staff during the holidays who were not always knowledgeable about the items on sale.

The association president said booksellers belong to one of the more heavily regulated industries in the country. He confirmed that there was a fixed mark up on books of 15 per cent.

“When parents see two prices on the tag and see that the difference is 15 per cent, they assume that it VAT, but that is the mark up they are seeing. The only grey area that exists is for novels for English Literature.

Novels fall in to a vatable category.” Regarding the $20 price difference we noted between the two bookstores for the same book, Charran said the industry was competitive and parents were likely to shop around to get the best prices.

He added that the association, which is two years old, is in the process of putting together a database of book prices over time.

Charran said based on information compiled so far, book prices have remained steady over the past five years.