Energy Increases Unavoidable, says Barker

www.barbadosadvocate.com Web Posted - Sun Feb 16 2003 By Petal Smith

GOVERNMENT has been careful to shield the public as far as possible from the effects of the increasing oil prices which were triggered by the pending Gulf war and the protracted strike in Venezuela. Speaking against the backdrop of increases in energy prices yesterday, Parliamentary Secretary in the Ministry of Economic Development, Senator Tyrone Barker, said government has been trying its best to contain the increases.

He pointed out that other Caribbean countries like Jamaica and Guyana have already had sharp increases in the price of fuel.

Speaking to the Barbados Advocate yesterday, Senator Barker said that even with this increase, the price for gasoline was less than it was ten years ago. He noted that the price of gasoline in 1997 was $1.54 per litre, and that price, he said was reflected since 1993 to 1994. “The excise tax was 90 cents out of the $1.54. We have reduced the tax by 25 cents per litre, that is almost $1 per gallon,” he said.

The Parliamentary Secretary said for every cent in the reduction of tax, government was losing approximately $1million on gasoline and about $750 000 on diesel.

“The reduction of 25 cents in gasoline will cost the treasury every year about $25 million on gasoline alone. Also, the tax for diesel went down even further by 33 per cent per litre,” Barker said.

He said because diesel is more of an industrial fuel, a massive cut on tax has being put in place. “In October of 1994, one of the first things we did was to remove the tax on imports to both the manufacturing and fishing sector.”

Furthermore, because of the impact of the fuel price on electricity, Government took a decision in 1998 to completely remove tax on fuel oil, “so we have done a lot to maintain the price of fuel at a level which will allow the industry to flourish”.

Senator Barker added: “We recognise the importance of the cost of fuel on production and we have taken concrete steps in the last eight years to lower the price.” He said if the full tax was levied on the fuel, consumers would have to pay an increase of 25 cents per litre for fuel.