KINGSTON, Jamaica — Former Finance Minister Dr Peter Phillips today defended his administration’s decision last year to impose a $7.00 special consumption tax (SCT) on fuel, in wake of a backlash from the public after his party criticised government’s new tax measures.
Government last week tabled a budget, which saw an increase in gas, cigarette and departure taxes.
But Phillips, while making his budget contribution in Parliament today, said the previous administration’s imposition of the $7.00 SCT on fuel was not inflationary because it occurred in the context of declining oil prices.
He said with world oil price now trending upwards above the US $36 [per barrel] on which the budget is based, makes it untenable.
Phillips said this tax would ultimately lead to price increases in transport cost for all Jamaicans “including helpers, security guards, school children, pensioners, and other poor people”, as the transportation sector cannot absorb these increases.
The Opposition spokesman added that with the increase in price for gasoline and diesel, marketing companies and retailers will pass the cost on to consumers.