Vol. 396 No. 5
62 Mr. R. Bruton asked the Minister for Industry and Commerce whether he has studied claims that the retail prices of records and cassettes in the shops have not been reduced to match the reduction in VAT and excise provided for in the budget; and if he will make a statement on the matter.
The Deputy will be aware that, following the 1990 Budget Statement by the Minister for Finance, excise duty on gramophone records, as well as on compact discs, was abolished. No excise duty was previously payable on prerecorded cassettes. The standard rate of VAT is reduced today from 25 per cent to 23 per cent.
My Department have not received any claims that retail prices of gramophone records have not been reduced to reflect the excise reductions. Since prerecorded cassettes were already free of excise duty, their retail prices would only be affected by the reduction in the standard rate of VAT which is effective today. The lower rate of VAT also applies today to gramophone records.
I have already indicated in this House that my Department have arranged that a retail price monitoring exercise is carried out to establish the consumer benefits from these VAT and excise reductions by way of lower retail prices. Inspectors under the control of the Director of Consumer Affairs and Fair Trade have already completed the first phase of the exercise, noting the retail prices of a wide selection of products in a range of outlets countrywide. The second phase will proceed shortly.
