VAT has been officially been removed from 16 categories of widely used food items, as part of a major fiscal measure in the 2026 National Budget.
As off today, staples like table salt, mauby, cocoa powder, vanilla essence, soy sauce, and locally made jams and condiments are now zero-rated, meaning no 12.5% VAT at the point of sale.
The Finance Ministry also confirmed that local produce such as pumpkin, lettuce, and watermelon can now be processed and sold VAT-free, boosting agro-processing and cutting costs for consumers.
It clarified that produce is no longer subject to the “unprocessed” rule for VAT exemption, allowing value-added products like packaged salads or processed pumpkin to remain zero-rated.
FULL LIST OF NEWLY ZERO-RATED FOOD ITEMS, as off October 17th 2025:
- Table salt
- Cocoa powder, whether or not containing added sugar or other sweetening matter;
- Mauby;
- Icing sugar;
- Grapefruit juice;
- Vanilla essence;
- Soy sauce;
- Prepared mustard;
- Guava jams and jellies in retail packages;
- Fruit, nuts and other edible parts of plants, otherwise prepared or preserved, whether or not containing added sugar or other sweetening matter or spirit, not elsewhere specified or included, including – (i) banana; (ii) plantain; (iii) breadfruit; (iv) sweet potato; and (v) cassava chips;
- Coconut water;
- Sauces and preparations therefor, mixed condiments and mixed seasonings, mustard flour and meal, and prepared mustard including – (i) pepper sauce; (ii) worcestershire sauce; (iii) anchar, kuchela and similar preparations; and (iv) all other similar sauces and preparations;
- Other beverages containing cocoa;
- Soya, tofu, gluten and vegetarian meat substitutes in any form, flavoured or unflavoured, otherwise prepared or preserved, whether or not dried or mixed with vegetables for consumption;
- Prepared or preserved cakes and muffins whether or not flavoured;
- Locally produced pumpkin, watermelon, cucumber, lettuce and tomatoes.
