By Rachel Belt
PORT-AU-PRINCE, Haiti (HCNN) -- The Haitian government has decided to raise taxes on a number of subsidized import products to protect the Caribbean country’s industries, which risk collapse, in the face of unfair competition from international products.
The Secretary of State for Fiscal Reform, Ronald Decembre, said the Haitian government has the obligation to protect local producers and industries that are supporting the country's economy and creating sustainable jobs for the Haitian people.
"We have incentive tariffs for products we wish people to import and deterrent tariffs for products we believe are harmful to national production," Decembre told HCNN in an interview on Wednesday.
Taxes on imported corn and beans will go from 3.5% to 15%, while duty on imported rum will reach 25% from the 15% applied now. Wheat flour, which was tax exempt, will now be taxed 15% and pasta products will go from 10% to 20%.
The tax on imported rice remains unchanged at 3.5%, because officials say the country did not have yet the capability to produce enough rice to satisfy the local demand, which is different for several other agricultural and industrial products.
The Haitian government claims these imported goods, often subsidized by producing countries, can be bought on the local market at a cheaper price than their equivalent produced in Haiti, which is driving many local enterprises out of business.
"We are not taxing just because we want customs to collect more money," Decembre said. "It is because the enterprises that are creating jobs here cannot keep up with the prices of subsidized products being dumped from other countries," Decembre told HCNN.
Taxes on many other goods will rise while duty has been reduced or eliminated on a range of other imported articles and input material, necessary to local producers' work, will become tax free.
Critics fear such measures could affect negatively the cost of living in a country where majority of the population is living on less than $2 a day.
However, the government argues the best way to turn the economic situation around is to protect and boost national production, create jobs and opportunities and generate the means to autonomously fund the projects that matter to the Haitian people.
"We cannot always count on the international community to finance our national budget and our projects," Decembre told HCNN. "As a people, we have to try our best to take our destiny into our own hands," Decembre stated.
Before coming into force in October, the tax adjustment document will have to be approved by both legislative chambers. The Lower Chamber approved it recently and the Senate intends to examine it in the coming days or weeks.