…stakeholders call for prices to drop as early as today
In a move aimed at combating increasing global prices for oil and the impact those increases have been having on the local economy, as well as rising cost of living, the Guyana Government has announced that the excise tax on fuel importation will be reduced to zero – a measure whose benefit it is hoping would be passed on to consumers as soon as possible.
Vice President Bharrat Jagdeo
This was revealed by Vice President Dr Bharrat Jagdeo on Wednesday during an outreach along the Essequibo Coast.
“Excise tax on gasoline and diesel now reduced from 50% to zero,” VP Jagdeo announced.
Meanwhile, President Dr Irfaan Ali, who is currently overseas, subsequently shared on his official Facebook page that this reduction is Government’s response to the increasing trend of fuel prices globally, in order to ease the burden on the Guyanese population.
“In response to the continuous increase in fuel prices on the world market, we have now reduced the excise tax on gasoline and diesel from 50% to zero,” the Head of State noted.
Natural Resources Minister Vickram Bharrat
In order to ease the impact of the rising cost of living on Guyanese, caused by the COVID-19 pandemic over the past two years and recently exacerbated by Russia-Ukraine crisis, the People’s Progressive Party/Civic Government has implemented a host of relief measures, including reducing the excise tax on fuel three times within the past year, from 35 per cent to 10 per cent before completing removing it on Wednesday.
In fact, the Guyana Revenue Authority (GRA) has already implemented this reduction with immediate effect.
“The Government has given approval for the rates on gasoline and diesel specified under the Excise Tax Act Chapter 82:03 to be reduced… These rates, which had been reduced from 20 per cent to 10 per cent as a Budget 2022 measure, are now being further reduced to cushion the global increases in fuel prices. As such, with immediate effect, all fuel imported will be subjected to these revised rates as administered by the Customs, Excise& Trade Operations (CE&TO), GRA,” the revenue agency indicated in a notice on Wednesday.
Benefit must be passed on
However, even with this latest reduction to zero, there are concerns about whether prices at the service stations would be slashed, and when. To this end, Natural Resources Minister Vickram Bharrat has implored businesses and operators to ensure this removal of the excise tax on fuel is passed on to the wider public.
“We do hope, and I’m sure the regulatory agencies – Guyana Energy Agency (GEA) and the Prime Minister’s Office, which energy falls directly under – that they would do some amount of checks and, if possible, enforcement to ensure that there is compliance and that people actually enjoy the benefit of the zero tax on fuel in Guyana…
“So I want to personally make an appeal to all service station owners, whether international companies or our own – well, we know GUYOIL (state-owned Guyana Oil Company) will reduce their price – that we ensure that this benefit reach the consumers,” Bharrat said to Guyana Times on the sidelines of the commissioning of the upgraded Shell Service Station at McDoom on Wednesday.
Moreover, the Natural Resources Minister went on to also appeal to public transportation operators such as minibuses and taxis to ensure that they do not increase their fares.
Further, admitting that often times the benefits of certain incentives implemented to bring relief to citizens are not passed on by businesses and operators, Minister Bharrat indicated to this newspaper that Government is hoping to see price reductions at the service stations as soon as Thursday.
“Well, the announcement was made today [Wednesday], so we would expect that as early as possible [it be implemented]… You know, sometimes gas stations stock up on fuel, so we’re not sure how early some stations will do it, but I know GUYOIL will obviously have to comply, so we’re hoping as early as [today] if it’s possible to see that reduction [in prices at the pump stations]. And I’m sure some of the private operators will follow because of the competition,” he contended.
According to the Natural Resources Minister, Government would continue to look at ways to help cushion the impact of the rising global prices on the local population and economy.
Help to cushion
Meanwhile, following Wednesday’s announcement of the removal of the excise tax on petrol, the Guyana Oil and Gas Energy Chamber (GOGEC) has urged the relevant state agencies to ensure this benefit is passed on to consumers.
“The Government’s action to reduce the excise tax on gasoline and diesel to zero is most welcome by GOGEC. This action would help to cushion the impact of the rising cost of fuel at the pump, and will benefit all Guyanese, especially the poor and vulnerable. GOGEC urges the relevant agencies to ensure that this reduction is passed on to the public,” the Chamber’s President, Manniram Prashad, has said.
It was only last week that two other major Private Sector bodies – the Georgetown Chamber of Commerce and Industry (GCCI) and the Private Sector Commission (PSC) – called for the removal of the excise tax altogether as a means of helping the population navigate these challenging times.
The prices of a wide range of commodities have significantly increased. Among them are fuel and flour, with the National Milling Company of Guyana Inc (NAMILCO) announcing a hike of 15 per cent on the price of flour with immediate effect.
Despite the Government this year further lowering the excise tax rate on gasoline and diesel from 20 per cent to 10 per cent – which should have resulted in major savings at the pump – recent global events have sent the prices up, with gas now retailing as high as $246 per litre locally. (G8)
