Thu | Sep 28, 2023

Clarke under pressure to reconsider fuel tax

Questions emerge over $2-billion provisional aid

Published:Tuesday | March 15, 2022 | 12:08 AMAndre Williams/Staff Reporter
Barrington Vineer, taxi operator in Cross Roads.
Barrington Vineer, taxi operator in Cross Roads.
Ansel Edwards, a cabbie who plies the Cross Roads to Mountain View Avenue route.
Ansel Edwards, a cabbie who plies the Cross Roads to Mountain View Avenue route.
Samuel Seymour, taxi operator, is watching and waiting for more details on the proposed $2-billion fuel break.
Samuel Seymour, taxi operator, is watching and waiting for more details on the proposed $2-billion fuel break.
Motorists fill up at the pump at a Texaco service station on Lyndhurst Road in Kingston.
Motorists fill up at the pump at a Texaco service station on Lyndhurst Road in Kingston.

Motorists who faced another round of fuel price hikes on Thursday are clamouring for Finance Minister Dr Nigel Clarke to reconsider his decision to maintain the seven per cent special consumption tax (SCT) on petrol.

Clarke, during his Budget Debate opening speech in Parliament on Tuesday, instead proposed a $2-billion provisional package for vulnerable groups. Details of the plan were not disclosed, but the poor and transport operators are expected to benefit from the initiative.

Petrojam announced a $4.50 increase per litre across the board for fuel on Wednesday. The hike took effect on Thursday.

Taxi operator Samuel Seymour is fearful that Clarke might not follow through on his pledge – particularly because many cabbies did not benefit from the one-off $25,000 COVID-19 state subvention. He believes that the current inflationary pressure will be far worse than the turbulence he experienced at the height of the coronavirus pandemic.

Taxi and other public transport operators have had to absorb rising fuel prices amid near 10 per cent inflation in January.

Another cabbie, Raymond McLaren, said the $2-billion provisional package will not be enough and questions how much would be set aside for each legal operator across Jamaica.

“If every taxi man going to get something, a whole heap a taxi man dem have, you know. I’m talking about legal taxi, not illegal taxi man,” said McLaren, adding that he rued missing the Budget speech.

McLaren charges passengers $120 – 20 per cent less than what some of his rivals collect in the competitive transport marketplace.

“I check the news on the overseas people that buy gas and is US$4 something a litre over there.

“Now we a feel the pinch here. Passengers asking when is the fare going to raise, and we just got a 15 per cent raise,” he said.

Barrington Vineer also missed Clarke’s announcement on Tuesday because he was working to accumulate money for his boss, who owns the taxi.

He has recommeded a $100,000 aid package for every taxi operator. He pays his boss $5,000 daily and purchases $3,500 for fuel.

“We deh ya park up and nothing nah go on, and the boss a go want him money when the day done,” Vineer said.

Taxi operator Ansel Edwards said he wants to hear the full breakdown of the $2-billion disbursement.

He had some advice for association representatives to consider during impending consultations with lawmakers.

“Negotiate with the minister and say, ‘All right, taxi man, when you go to the gas station, you get a concession. For a fare increase, the people dem nuh have it. The Government can afford to roll back [the tax] on the gas, but the cheapest and easiest way out is to pass it on to the consumers who nuh have it,” Edwards said.

Egeton Newman, president of the Transport Operators Development Sustainable Services (TODSS), said he listened Clarke attentively and that an emergency meeting with his members has been called to discuss the disbursement proposal.

“Not only the public transport sector, but the entire productive sector was looking for the minister to roll back the SCT on fuel. The fact that he explained the reason that it can’t be rolled back and give us something, I think it’s a good move, to put up $2-billion support fund, and we have to make good of it,” Newman told The Gleaner.

Newman said, however, that the support fund would not be enough. He has advocated for a fare increase, arguing that the 15 per cent rise last year was insufficient.

“When we pencil it out when $2 billion goes to the transport sector, each of us could get about $57,000, because it’s about 40,000 of us. We don’t expect that to happen, but $57,000 right now can do something, but for how long?” Newman questioned.

That calculation, however, misses out on the potential thousands of poor commuters that Clarke’s plan may also target as beneficiaries.

According to the TODSS president, cabbies want to meet with Clarke because of what he calls the embarrassment from the COVID-19 grant is still fresh in their minds.

“He gave us with one hand and take it back with the other hand. Ninety per cent of the sector did not receive that $25,000 that was promised by the Government, and that is why my team, advised by Dennis Chung, will meet to look at the package, look at what is needed, and how it should be provided and then we make a report,” Newman said.

Dianne Parram, president of the Jamaica Gasolene Retailers Association (JGRA), expressed disappointment that Clarke stood firm on the SCT. And although she takes the provisional aid in good faith, said it was too early to comment as the finance minister did not give details on the workings of his proposal.

“We hope the minister will reconsider,” she said of the SCT on fuel.

Parram said the JGRA understands that the Government wants to help the most vulnerable but noted that price hikes at the pump affected every sector.

Last Wednesday, Petrojam said that E-10 87 would sell for $186.93 per litre and E-10 90 for $191.92.

Automotive diesel oil was priced at $190.97 per litre.

Retailers added their margins.