Excise tax on fuel – only new tax measure

Government has announced a 50 cents per gallon increase in excise tax on diesel and gasoline, effective February 1, but downward trending international oil prices will still push down gasoline prices at the pumps for Vincentians.{{more}}

Prime Minister Dr Ralph Gonsalves announced the increase as the only new tax measure in his 2014 Budget address, presented at the House of Assembly in Kingstown yesterday afternoon.

The measure will earn Government an additional three million dollars per year, and help augment revenues which recorded a 7.2 per cent decline in 2013, contributing to the overall current account deficit for the last financial year.

The Prime Minister, however, announced that the excise increase is not expected to have any immediate significant upward impact on the price of fuel at the pump because of the downward trend of oil prices in recent months, and in the case of gasoline, the entire 50 cents can be accommodated by the lower price of gasoline.

“Indeed, I hereby announce that with immediate effect, the price of gasoline will be reduced by 12 cents per gallon and the price of diesel will be increased by 37 cents per gallon,” the Prime Minister said.

The retail price for diesel will therefore move from $13.32 to $13.67 per gallon, and the price of gasoline from $14.48 down to $13.94 per gallon.