THE CYPRUS Green took to the streets of Nicosia and Limassol yesterday to protest the introduction of a five per cent VAT on food and prescriptions by offering cheaper bread.
To highlight to increased cost, several of the party members set up stalls selling bread at the pre-VAT hike prices while calling for a one-day boycott of major supermarkets.
Green Party political officer Kyriacos Kyriacou said: “All of the bread was gone in half an hour – we sold 200 loaves in Nicosia, and so as far as I am concerned it went very well.”
Asked about the success of the supermarket food boycott, Kyriacou said that several people participated, but he considered number of people who heard the message to be more important.
“Everyone in Cyprus they got the message that this affects everyone, and we hope the government heard that it is not (feasible) in an economic crisis to put VAT on important food products” said Kyriacou.
In downtown Nicosia most customers were aware of the price hike. One shopper in Debenhams’ Ledra Street store said: ““I noticed that I paid a little more, but we will feel it later” while another said: “Of course, I noticed the difference as before you would get all of these things for a lot less.”
A third was less aware: “I just finished shopping now so I haven’t checked yet.”
It seems the real effects of the increase in prices will be felt over the long term when the weekly bills mount up. However, it is not just consumers who will be affected.
One Nicosia bakery owner said yesterday that most of his customers had noticed the increase in price, and he anticipated a drop of much more than five per cent in business when people start to adjust their spending habits.
“I think it’s going to be really bad, especially for those on low incomes. The effect will be that they will only buy what is necessary, so they will buy small loaves instead of a big one, and instead of buying six bread rolls for a four person family, people will just buy four.”
The new legislation is also likely to hit stores that sell only food such as bakers and butchers harder than supermarkets, which can cushion the price increase by putting up the prices on non-affected stock.
Kyriacou believes that this change in spending habits will prompt people to put more pressure on the government to consider alternatives. “I expect the government will give (an alternative) to the five per cent tax in order to stabilise the economy. Soon people will begin to notice that their milk has increased in price by seven or eight cents” he said.
As of yesterday, all foods drinks and medicines, except for alcoholic drinks, would incur a five per cent VAT in line with Cyprus’ EU obligations. Alcoholic drinks carry 15 per cent VAT.
