The Excise duty for regular gasoline has climbed to $4.41 per imperial gallon under the fuel-price stabilization program.
According to Statutory Instrument No. 124 of 2022, published in the Gazette on September 6th, the rate of excise, for the first time in five years, has moved beyond $3.95 for this fuel product. This almost 12 percent increase over the pre-stabilization-program rate is a feature of the fuel-price fixing mechanism that holds regular gasoline at $13.50 as opposed to being closer to $13.04 if the original rate ($3.95) was utilized.
As readers would recall, The Reporter last spoke with Minister of State Christopher Coye on the program back in August. At the time, the duty rate was at $3.07, a figure still below the original charge of $3.95 per imperial gallon. “We continue to incur mounting excise tax losses [due to the price stabilization program]. Recall that immediately before the Government started the stabilization program, the excise tax [was]... $3.95 per imperial gallon for regular gasoline,” informed Coye."
Coye added that as long as the rates were below their pre-COVID levels, the Government of Belize (GOB) will continue to incur "losses" relative to what was budgeted. Speaking specifically to Regular fuel, at $3.07, the government was forgoing $0.88 per imperial gallon.
Consequently, the new rate being at $4.41 per imperial gallon would suggest GOB is attempting to accelerate the rate of recovery of forgone tax revenues at an additional $0.46 per imperial gallon.
The price stabilization program is the government’s policy in which it has virtually fixed the prices for diesel and regular. Under the program, when the international prices and acquisition costs were climbing, the excise duty was cut in an effort to absorb some of the fuel cost pass-through.
However, the stabilization program also works in reverse. It was designed to help government minimize its overall revenue shortfall by keeping the prices of the two products fixed in the $13 range even when acquisition costs began to decline, which judging from the higher excise for Regular that is charged at $13.50, have certainly begun.
It is worth noting that the pump price for Premium fuel has decreased this week from its previously fixed position of $17.60 to about $16.60.