CAMA warns of unscrupulous traders charging different prices at the till

Consumers Association of Malawi (CAMA) is warning Malawian consumers to be alert when they go shopping, saying some unscrupulous traders are charging different prices at the till than those displayed on shelves.

In a public notice issued on Thursday, May 6, CAMA says most traders have taken advantage of the current economic downturn — coupled with the effects of CoVID-19, which have created scarcities and price increases on some goods and services.

“Most of the price increases are unjustifiable and pure theft with no better economic explanations and some are tampering with weights and contents of their packages,” said CAMA executive director, John Kapito in the statement.

“It is therefore, important and incumbent upon every consumer to seriously carry out a market surveillance on prices and quality of the goods.

“As a consumer, it is your money and it is important to make sure that you are responsible and aware of the prices and quality of products that you are buying from the market.”

Thus Kapito urges the public to be checking the shelf prices and contents and compare them when paying at the till as most shops charge different prices on the till than those displayed on the shelves.

He observed that most consumers do not bother to be assertive or being alert and thus some traders taking advantage of that.

Another warning to consumers is that “there is a growing tendency among certain shops that do not give back change” saying they must insist to always demanding the change back — “no matter how small it might be”.

“As consumers, let’s act responsibly each time we go out for shopping as the market has become complicated and dangerous — always protect yourself.”

Meanwhile, CAMA has further issued a public notice on the saga of the increase in the price of cooking oil, appealing to Malawi’s Financial Intelligence Institutions, the Competition and Fair Trading Commission and the Ministry of Trade to take action.

Issued on Tuesday, CAMA appeals to these three financial institutions to investigate “why cooking oil manufacturers prefer importing their raw materials and investigate whether there are elements of price transferring plus collusion”.

“The Competition and Fair Trading Commission is to investigate why the cooking oil manufacturers are operating as an Association whose interest is to fix market prices and control the distribution and sales of their products on the market.

“The Ministry of Trade is to investigate why the cooking oil manufacturers are importing crude oil in a country with more resources and capacity to produce such raw materials.”

CAMA contends that is deeply concerned with misleading information from some players in the edible oils industry with regards to the reintroduction of value added tax (VAT) on cooking oil.

The consumer watchdog said following widespread concerns raised by the general public in the mainstream media, as well as social media, that the reintroduction of VAT on cooking oil by the Government has resulted in increased cooking oil price, it carried out a study to determine facts regarding the matter.

The results of the study were that before the reintroduction of VAT in October 2020, a 500ml) bottle of cooking oil was selling at K520.

“Surprisingly, this went up to K790 shortly after the reintroduction of VAT, an increase of approximately 50% whereas the VAT increase would have been less than the 16.5%.

“VAT in Malawi is a tax paid by consumers, and this is a tax collected on a number of basic products and services including drinking piped water and electricity, which are the very basic commodities compared to cooking oil.

“Cooking oil producers, directly and indirectly through their association, have failed to provide us with any justification for their call to have VAT exempted on cooking oil compared to other products such as water and electricity.

“The cooking oil producers have failed to demonstrate with facts how the reintroduction of 16.5% VAT has resulted, or should be attributed to the huge increases of more than 50%. CAMA has realized that most of their arguments are fictitious.

CAMA takes cognizance that prices of crude oil, locally used in the refining of cooking oil, has increased on the global market “hence the local shelf prices of cooking skyrocketing substantially”.

“Therefore, the massive increases of cooking oil in Malawi is as a result of the high import prices of crude oil.

“The choice to import crude oil and using the hard-earned foreign exchange is the blatant disregard of the country’s local farmers, who have the capacity to produce most of the raw materials such as Soya beans, Sunflower and Groundnuts used in the production of cooking oil.”

CAMA also reminds the public that cooking oil producers — just as all industrial manufacturers — “enjoy a number of tax reliefs/exemptions on the importation of their raw materials and machinery, whose benefits have not been passed on to consumers”.

“We are therefore, appealing to the Malawi cooking oil industry to stop manipulating, mobilising and patronizing consumers, Government and the media with lies and misleading statements in order to hide their appetite for high profits.”

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