02 Jun Statement on Petrol Price Increases by Phillip Paulwell, Opposition Spokesman on Energy
The just released petrol price index by Petrojam Limited effective today, (Thursday, June 1, 2017) indicates that petrol prices to the Jamaican consumer have been increased by some 40 percent over the past 15 months. While petrol prices do fluctuate in response to market conditions, since the beginning of the year the trend in Jamaica has been an upward spiral and has been made even more pronounced since the imposition of the new tax measures.
The ill-conceived and massive tax on petrol and petroleum products recently implemented by the Government has definitely exacerbated the problem and its effect has begun to hurt the average Jamaican.
For instance, since January 2017, Gasoline 87 has moved from a low of $96.16 to a high of $113.66 as at June 1, 2017 and Gasoline 90 has jumped from $97.82 to $116.50 over the same period. These points to (1) a widening of the price gap between the two grades of fuel and (2) a very sharp upward climb of both, with their corresponding and acknowledged negative impact on all sector and facet of the society.
As the current atmosphere of hardship and uncertainty in this country deepens, it is a direct result of government’s attempt to fulfill a miscalculated election promise, which has now manifested itself by way of the burdensome new indirect taxes falling on a much wider pool of Jamaicans especially the poor. The most vulnerable in our society are under severe survival pressure as a result of the burden of the new indirect taxes and the announced increase in the budget for the PATH and School Feeding Programmes will not suffice, as many of these folks do not qualify for these PATH benefits.
Already, the imposition of the taxation on fuels is triggering untold hardship and the real prospect of runaway inflation and given the widespread use of fuel, the additional taxes imposed will negatively impact many activities including the cost of public and private transportation, the haulage of goods, electricity generation and manufacturing generally. These in turn will have a negative impact across the economy, crippling the wellbeing of all Jamaicans.
The sharp increases in the prices of food, petrol, electricity and other commodities and services, accompanied by a large tax package of $14 billion is today’s painful reality. The significant price movement in gas prices if unabated will soon create economic devastation and hardship throughout the economy, as all goods and services will be increased and the poor will be burdened even more.
In contrast to what now obtains, on February 25, 2016 when the government assumed office and under similar market conditions, the prices were as low as $81.58 and $83.23 for Gasoline 87 and 90 respectively. This is before the addition of margins by marketing companies and retailers.