Vaz Clarifies Energy Drink Tax Issue

KINGSTON — Minister with responsibility for Information, Telecommunications and Special Projects, Hon. Daryl Vaz, has given an assurance that talks will be held with producers of energy drinks, to clarify Government's position on a Special Consumption Tax (SCT) on the product.

“I am confident that that new redefinition will make the playing field balanced, based on the  utterances I have heard from the Jamaica Manufacturers’ Association in relation to imported as against locally manufactured energy drinks,” Mr. Vaz said, while apologizing for the misunderstanding at Wednesday’s September 21 Post-Cabinet press briefing at Jamaica House.

The Minister was clarifying a statement he had made a week earlier, regarding Cabinet’s decision to “reintroduce” the Special Consumption Tax (SCT) on energy drinks.

He recalled that energy drinks were included in items slated for GCT increases levied on the alcoholic content alcoholic beverages inclusive of wines, beers and stouts, which became effective in December 2010. However, concerns were raised about the definition of energy drinks and the Government agreed to take a second look at the issue.

Following Mr. Vaz’s statement about the reintroduction of the tax some manufacturers, who had been meeting the tax requirement raised concerns and sought clarification from the Government. However, the minister explained Wednesday that his use of the word “reintroduction” was not intended to convey that the previous order gazetted in December 2010 had become ineffective, as the tax on energy drinks is currently being administered.

“A Cabinet decision was (however) taken to introduce a new order, which will adopt the definition of energy drinks, used by the Ministry of Health. This definition differs from the definition in the previous order, in (that) it is not limited to caffeine content, but also makes reference to a defined list of herbs, amino acids and other ingredients, either alone or with caffeine,” he explained.

Mr. Vaz said that until the new Order is gazetted and entered into force, the existing Order of December 2010 remains intact, “which means that the SCT that has been charged, will continue to be charged and collected”.

By Douglas Mcintosh, JIS Reporter