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Bakers decide to increase the price of bread to RD $7

SANTO DOMINGO. The assembly of the bakers brought together under the Union of Medium and Small Flour Industries (UMPIH), decided to increase to RD$7.00 the price of a unit of “pan de agua”, but they have still not set the date this goes into effect.

The president of the UMPIH, Francisco Capellan, said that the assembly permitted the leadership of the entity to analyze the day in which all the bakers should apply this increase.

The business leader said that this period of analysis regarding the effective date of the increase to the price of bread could give enough time for the government to call the bakers, and find some joint solution to the costs that their businesses have to face, and so stop the increase in the price of this product.

As has occurred on former occasions, the bread makers announced that the increase in the price of bread will come together with an increase in the quality and the size of this product.

Nevertheless, time has shown that each time that they make this type of announcement the “pan de agua” goes back to its normal size.

The executive director of the Consumer Rights Foundation (Fundecom), Alfonsina Cuesta, said that more than 50% of workers receive less than RD$9000, which, according to her explanation, does not allow them to acquire the products of the basic family food basket and much less be able to support an increase in a product so essential such as bread. “It is not possible that with the precarious situation experienced by the population, above all those with the least buying power, a product so significant such as bread which is in all Dominican homes does not cause an effort to be made by the authorities in order to sit down and find a solution which does not affect the population,” indicated Cuesta.

Given the demand for tax exemptions that have been made by the bakers in order to maintain the price of bread without change, the executive vice president of the Industrial Association of the Dominican Republic (AI RD), Circe Almanzar, said that it would be a distortion to maintain exemptions on the purchase of the raw materials and derivatives for the production of bread.

An agreement with the government

In November 2013, the bread makers had announced that they would increase the price of bread to RD$7 just as they have done now, but later they left the increase that they had analyzed without affect , because they reached an agreement with the government, through which they were granted several incentives.

The agreement brought a loan and exemptions

The agreement reached between the government and the bread makers at the end of 2013 in order that the increase in the price of bread not take effect, permitted them to benefit from RD$300 million in loans, the purchase of 420,000 “teleras”-the ubiquitous Christmas season bread– and the exemption from the ITBIS until December 2014 for the raw materials that they use to make bread. The president of Codopyme, Isaachar Burgos, said that the government fulfilled nearly all of the agreement, but that regarding the part of the exemptions, these were to last until the end of this government’s administration, and they were taken away last December.

Source: DiarioLibre

March 6, 2015

Category: DR News |

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