BELIZE CITY, Tues. Dec. 29, 2015–Pump prices spiked at midnight on Sunday, December 28, largely due to an increase in import duties on premium and regular gasoline as well as diesel, resulting in an increase of up to 13% at the pumps.
“This increase has become necessary as a fiscal consolidation measure to strengthen public finances at the start of the new 2016 calendar year and also to compensate for the decline in revenues linked to the decline in domestic crude oil production,” said a statement from the Ministry of Finance on Monday.
When consumers buy regular or premium gas, 45% of the bill consists of taxes to the government. Consumers who buy diesel pay a little less, with 41% going to the government in the form of taxes.
Many consumers who have been observing market trends and seeing oil prices tumble to as low as US$30 a barrel have been questioning why Belizean consumers have not seen the prices fall more substantially at the pumps.
The latest information indicates, though, that while the cost of landing premium fuel in Belize fell by 7 cents on the gallon from $3.90 to $3.83, pump prices actually increased from $8.58 to $9.30, with the taxes at the pump increasing by 75 cents on the gallon.
The Ministry of Finance’s statement disclosed that further taxes were being levied on the three main fuel products, but not on kerosine, which will continue to be sold for $4.94 a gallon in Belize City.
While that’s the Belize City price, consumers in the districts pay even more, since truckers are allowed to charge a per-mile fee for distributing fuel to the various supply points around the country. So Punta Gorda residents are now paying $9.55 for a gallon of premium and $8.77 for a gallon of regular gasoline.
Corozal consumers are now paying 12 cents more per gallon for diesel than Belize City residents – $7.00, and $8.63 for a gallon of regular gasoline.
The Government release announcing the increase in pump prices forecasts an eventual fall in pump prices in the coming weeks.
It says that “…prices of imported fuel products will decline significantly in step with declining world oil prices and… pump prices will stabilize at a point below $9.00 and $8.00 per gallon mark for premium and regular gasolines respectively and below $6.50 per gallon for diesel oil.”
In 2014, the price of regular gasoline held at around $11 a gallon, but fell sharply on January 13 to $7.57. Since then, prices have been substantially lower than 2014 prices.
Of note is that this is not the first time that a tax adjustment has triggered a price increase at the pumps. Last May, for example, the price of premium gas was increased due to a nominal increase in the tax levy, resulting in a price adjustment from $11.67 to $11.87. In November 2014, the landed cost of regular gas went down by about $1.50, but savings at the pump were less, due to an increase in the fuel tax by about 60 cents on the gallon.
According to the Statistical Institute of Belize’s latest trade bulletin, earnings from Belize’s crude petroleum exports plummeted by $59 million for the first 11 months of 2015. The SIB reported that Belizeans have spent roughly $210 million on mineral fuels and lubricants for the period January to November 2015, down from $280 mil for the same period last year, a decline of about $70 million. In November alone, Belize spent $18 mil on imported mineral fuel and lubricants.