PM Says Further Tax Cuts on Fuel Would Mean Cutting Services

Prime Minister John Briceño says the rise in fuel prices is driven by the war involving Iran and that cutting fuel taxes further would force cuts to social services.

The Prime Minister appeared this morning on Open Your Eyes and was asked about fuel prices climbing again.

While he was presenting in the House on Friday, he said diesel is rising worldwide. “The price of diesel continues to go up worldwide, and the big problem there is simply because of this war in Iran.”

“They’re at a stalemate. Nobody wants to step back.” He said small open economies like Belize are among the hardest hit.

He said successive governments have relied on fuel taxes because the volumes are known and easy to collect, and that cutting them is the only lever available. “The only thing we can do is to be cutting down the taxes. We’re cutting down the taxes right now on diesel; it is, I think, below $2.”

He said deeper cuts carry a price. “I know people say, ‘Oh, that’s still a lot,’ but if we cut on these taxes, then we have to cut some of the social services that we give. There has to be a balance. We can’t spend what we don’t have, and we are doing as best as we possibly can.”

Briceño listed the relief the government has provided. He said education assistance will be about $60 million this year, with 80 per cent of high school and sixth form students receiving some assistance. He cited the income tax threshold raised to $29,000 and GST removed on electricity for almost 100,000 people. He said 29,000 people in Cayo alone are already registered and that a little over 100,000 people countrywide have not registered for National Health Insurance.

He also questioned retailers. “Sometimes we question also the owners of these supermarkets that you suddenly see them scratch the old price and put a new price.” He said ministers bring examples to Cabinet, such as an item that went from $1 to $1.20 to $1.25. He said the government has not raised taxes, and many food items are zero-rated. “Government is trying to find ways how we can minimise the burden.”

Earlier this month, Briceño said fuel tax cuts had already cost the government about $40 million.