Black Immigrant Daily News
BELIZE CITY. Wed. July 13, 2022Today, Prime Minister John Briceño said that the Government of Belize will have to let current fuel prices remain in place, despite a global decrease in the price of oil, in order to recoup revenue from excise taxes that was forfeited by the government when it decided to cap fuel prices in April of this year. The government, in its April 7th Cabinet brief, had pledged to provide relief to the Belizean public by placing a “firm cap” on the prices of diesel and regular gasoline, which it had said, would not rise above $13.41 and $13.50, respectively. The prices of those fuel products have seen a slight increase, of a few cents, since then but have not jumped the $14-dollar mark, while the price of premium gas, which was not capped, has since reached as high as $16.03 per gallon.
With global crude prices inching downward, however, some Belizeans might have been anticipating a reduction of local prices at the pump, but according to the Prime Minister, Hon. John Briceño, the government will be holding the prices at the current rate in order to recover the millions of dollars it had forfeited through the price caps it had put in place.
“We have to hold it on as long as we possibly can,” PM Briceno said, referring to the current fuel prices. He added, “I believe that [the] price of crude oil is starting to go down on the world market; I think yesterday it was at US$95 a barrel, so we expect that the prices are starting to go down slowly. The idea, as I mentioned earlier, is to hold it at a price – at where it is right now – and as the acquisition cost of fuel goes down, we still want to hold it for a bit to be able to recoup some of the expenses, of the tax dollars that we lost, because at the end of the day we do need the revenues to be able to provide the services to the Belizean people.”
The cap on fuel prices that has been in place over the past few months was made possible through a fuel price stabilization fund that was established with the help of the Central Bank. The April 7th Cabinet brief noted, “Currently, the government has already reduced excise taxes by 57% to keep diesel prices at the capped price of $13.41 per gallon. On an annualized basis, these tax reductions represent an excise tax loss of over $30 million. Without such tax reduction, diesel pump prices would have been $2.13 per gallon more at $15.54 per gallon at the tax rates applied over the past five-plus years.”
At the time that the fund was established, the Prime Minister had explained that the fund would reduce fluctuations in local fuel prices by enabling the government to use surplus funds that it collects when the capped prices are higher than what would otherwise be the local price of fuel, to cover the losses in revenue that it incurs when the amount that should be collected for fuel is higher than the capped prices at the pumps.
The high fuel prices have nonetheless been an ever-present thorn in the sides of the Belizean people. In Punta Gorda, premium gas prices reportedly have been as high as $17.85 a gallon. During an interview in late June, Minister of the Public Service, Hon. Henry Charles Usher said the government made the decision to cap the prices of regular gas and diesel in hopes that it would be an acceptable compromise for the Belizean public.
“People are complaining about the price of premium, but we just made a decision. Listen, we can’t hold all of them down; it would be too much of a financial impact on the country, and there is an option—if you don’t want to put premium in your vehicle, you can put regular. We feel that is a compromise that would be accepted,” Minister Usher said.
He further noted that these decisions were made against the backdrop of a promised reinstatement of public officers’ full salaries. “We always made sure that whatever decisions that we made would not affect the July 1st announcement that the salary would be returned. That was the number [one] priority, but we had to make sure that we held down the price of diesel and the price of regular fuel,” he said.According to the Prime Minister, The Belizean people will have to endure these current fuel prices until the losses in fuel taxes are at least partially recovered.
“I’ve said it many times that the idea was to set a fund from Central Bank, so as we’re reducing the tax we can try to replace it – we did not do that right now – but that when the prices start to go down, we can keep it there to try to get back some, not all of it, some, and try to work on bringing down the price of fuel,” PM Briceño said.
The PM has not provided a timeline to indicate how long the current prices will remain in place, but echoed the position of CARICOM leaders who are currently calling for US sanctions to be lifted from Venezuela in hopes of a resumption of the PetroCaribe program, through which countries in the region were able to purchase oil at reduced rates on a credit basis.
“We have been talking through CARICOM to Venezuela and to the United States, about asking the United States to ease up some of its restrictions with Venezuela and that we may have an opportunity to get back the Petro Caribe program going once again. Maybe it might not be as generous as it was before, but we are still looking at like paying 70 cents on the dollar or something like that, but that in itself is going to be a big help,” PM Briceño said.
While this remains a hope across the region, rising fuel prices continue to drive up prices of everyday commodities. When pressed to comment on relatively low fuel prices in Central America, Hon. Briceño remarked that certain factors drive up the cost of fuel acquisition for Belize and other CARICOM member states.
“What is happening is—volumes, for instance: El Salvador has what, 8, 9 million people; we have 430,000, so when we buy one gallon, they probably are buying a hundred gallons, so obviously they can get cheaper prices than Belize, and also the cost of delivery, because they come in smaller ships; you know, it’s more expensive, so those are the advantages that bigger countries have over small countries like us in Belize, and the Caribbean. In the Caribbean, some of these areas, the price of fuel is even higher than Belize,” PM Briceño said.
On Tuesday of this week, oil prices fell below $100 for the first time since April. Today the price of WTI crude oil was $95.84 a barrel.
NewsAmericasNow.com
