The president of the Dominican Traders Federation, Ivan Garcia said yesterday, Monday 12 November that consumer sales could drop 20-25% in the first six months of 2013 as consumers refrain from paying higher prices. Interviewed during the El Bulevar con Pablo McKinney radio talk show, he said that “a perfect storm scenario” could occur next year. It will be the first time that fuel, electricity rates and all articles for sale go up. The Medina government is implementing the just-passed Fiscal Reform Law 253-12 that increases VAT tax to 18% starting January and includes a RD$2 extra tax on fuel sales. An increase in the electricity tariff for consumers who pay for the service is also expected in 2013. In addition, he said the peso has depreciated 3% and the difference is being passed on to consumers. Garcia said that 64% of local consumption happens in small grocery stores and 36% in the large chains. He said that the increased tax on fuel sales would lead to an increase in cargo costs to be reflected in higher consumer prices.
www.hoy.com.do/el-pais/2012/11/13/454571/Comerciantes-advierten-paquete-tributario-disminuira-ventas-en-un-25-en