Rice farmers protest Finance Ministry over high fuel prices

Members of the Rice Producers Association (RPA) on Wednesday protested the Finance Ministry, calling on Government to review its tax policies on fuel with a view to easing the burden on the productive sector.
The Association has urged Government to reintroduce a sliding tax rate for rice farmers in light of the high cost of fuel and especially in light of ongoing land preparation taking place in the sector.
While on the protest line, General Secretary of the RPA, Dharamkumar Seeraj, told the media that method is easy and would not add any unnecessary burden to the Government’s budget.
“The way it works is that when the price for fuel goes up on the World Market, the tax comes down so the price at the pump remains the same, so it’s not rocket science and most importantly from the Government’s point of view, this will not affect the target budgeted for,” he explained.
Seeraj reasoned that if the price for fuel increases and Government reduces the

percentage of taxes on fuel, they can still achieve their target.
“If you implement that sliding rate, the country benefits. Production will go up, you’ll become more competitive on the export market and that is what a country needs,” he asserted.
The RPA said farmers, who are currently harvesting, have been experiencing an increase in transportation costs from an average of $200 to $800 per bag, because access to their farmlands is poor.
Many have been forced to use a combination of poor dams and weed-infested waterways and this increase in fuel prices might very well be the proverbial last straw.
Additionally, most farmers are currently involved in land preparation exercise and sowing of their fields and where most fuel is being used compared to the crop duration, so the increase is coming at a really bad time for the farmers. As reported, the fuel woes are compounded by challenges of readily accessing fertilisers owing to financial challenges.
The RPA has since said that the “good life” that the A Partnership for National Unity/Alliance For Change (APNU/AFC) Government promised was wanting, adding that the Administration’s inaction on the matter was not an option.
In April 2017, Mahaica farmers, whose main source of income is rice, along with cash crops, said the taxation measures were “harsh” to them.
The farmers said then that the Government has removed the list of exempted and zero-rated Value Added Tax (VAT) items, causing them to have to increase their cash crop prices, much to the dissatisfaction of their customers. The cost of production, they noted, extended to an increase in payment for fertiliser, insecticide and weedicide.
Several former Government officials and sitting Members of Parliament (MPs) have been repeatedly calling on Government to reduce the taxes of fuel imports. Opposition Leader Bharrat Jagdeo has said Government has the fiscal space to do it, and it is nothing difficult as it was done in the past.
Opposition MP Irfaan Ali has also urged Government to move swiftly to reduce the Excise Tax on petroleum products, thereby creating a reduction in the price for fuel at the pumps.
Ali said at present, global oil price is the same compared to November 2008. However, price of local gas stations in November 2008 is less than present by 15.5 per cent at $194.
Global oil price in January 2015 (under the previous Administration) and September 2017 was the same. However, the 2015 price is less by 15.1 per cent at $173.
At same level of global oil price, the price of fuel under the People’s Progressive Party/Civic (PPP/C) Government was significantly less when compared to that of the APNU/AFC Government.
Ali also noted that Guyoil benefited substantially, post 2015, from low market prices of oil. He therefore explained that if the projected $3 billion after-tax profit was achieved by end of 2017, total profit generated by Guyoil during the last three years would exceed 2008-2014 total level, by more than 10 per cent.
“By not reducing local fuel price in relation to global oil price since 2015, Guyoil was able to increase its profit margin significantly. Given Guyoil’s high profit margin, the company could afford, presently, to reduce fuel price and ease growing economic burden,” he added.
In September 2017, world market prices for fuel increased due to the hurricane, which resulted in Guyoil adjusting the prices in gasoline, diesel and kerosene to a higher cost. Again, in February of this year, Guyoil adjusted its prices upwards. The average price of gasoline around the world is US$1.15 per liter.