Tax hike to raise retail fuel prices

RETAIL fuel prices are expected to rise next year due to an increase in tax for imported fuel, Independent Consumer and Competition Commission (ICCC) chief executive Paulus Ain, pictured, says.
Ain said this while clarifying the Independent Consumer and Competition Commission’s role in monitoring fuel prices on how these changes would not impact arrangements in place with Puma Energy.
“The Government has approved an increase in the excise duty for diesel from 10 toea per litre to 23 toea per litre, which will come into effect from Jan 1,” he said.
“Due to the increase in excise, Government taxes on diesel will account for 17.8 per cent of the final retail price for diesel in 2018, which is an increase from 13.1 per cent in 2017.”
According to Ain, the increase in excise duty for diesel alone will increase the final retail prices for diesel by around 5.75 per cent in 2018.
“Fuel importers will have to absorb the import duties in their margins. Therefore, to avoid paying the import duty, fuel importers are encouraged to source fuel from Puma’s Napa Napa Fuel Refinery,” he said.
“The increase in the excise duty will likely have a cumulative effect on general inflation in 2018. Prices of goods and services will likely increase in 2018 as transport costs and other costs of providing these goods and services are likely to increase due to increase in fuel costs.
“The commission is urging the people to prepare for these new changes by the Government, and cut back on wasteful spending.
“The ICCC has no control over the introduction of new fuel taxes. This is the prerogative of the Government of PNG.”