Fuel import costs to rise 1 July

Increase will affect gas, electric bills

Prices
at the pump and on utility bills will rise starting next month following
government’s approval of a 25 cent increase on gas and diesel import tariffs.

The
25 cent per gallon increase will raise import duty from 50 cents to 75 cents
per gallon for gas and 60 cents to 85 cents a gallon for diesel. Caribbean
Utilities Company officials have said they expect an average 5.5 per cent hike
in electric bills as a result of the measure. CUC is the largest consumer of
petrol in the Cayman Islands and uses fuel to power its electricity generation
system.

The
increase on gas and diesel import tariffs passed the Cayman Islands Legislative
Assembly on Monday afternoon by a vote of 8 to 6.

Voting
for the measure were Premier McKeeva Bush, Deputy Premier Juliana
O’Connor-Connolly, Ministers Mark Scotland, Rolston Anglin and Mike Adam, and
MLAs Ellio Solomon, Capt. Eugene Ebanks and Cline Glidden Jr. MLA Dwayne
Seymour was absent.

All
five opposition party members, as well as independent North Side MLA Ezzard
Miller, voted against.

The
import duty increase is expected to take effect on 1 July. It will not be
applied in Cayman Brac.

Opposition
Leader Kurt Tibbetts urged government members to consider other ways of raising
the $10.2 million the increase is expected to bring in over the next year. He
said there was very little chance petrol stations and CUC would simply eat that
additional cost.

“The
way (CUC’s) rates are structured…the fuel factor is a direct flow through or
pass through to the customer,” Mr. Tibbetts said.

He
suggested that government consider a 5 per cent charge on cell phone bills,
raising fees for car licensing and driver’s licence fees, as well as increasing
the cost of visitors’ permits to help raise the additional funds.

“We
feel that they will not have that knock on, domino effect to the consumer,” Mr.
Tibbetts said. “A cell phone is not like gasoline. The use of a cell phone is
much more discretionary.”

Premier
Bush said he felt the opposition party’s last-minute alternate proposals for
raising money to help cut Cayman’s operating deficit were simply not genuine.

“If
we had put (increases) on those areas, they would be making the same claim they
are about the 25 cents on gas and diesel,” Mr. Bush said. “We all know the mess
we’re trying to clean up was their doing.”

Mr.
Bush has frequently slammed opposition party members – from the previous ruling
government – for leaving the Cayman Islands with an $81 million operating
deficit as of 30 June, 2009.

He
also accused opposition members of negotiating a “sweetheart deal” with CUC
that allowed them to pass through fuel factors directly to consumers.

“Well,
change it,” Opposition MLA Arden McLean yelled across the Legislative Assembly
floor in response to Mr. Bush’s statement.

“Change
it after you signed it for 25 years? They’re a bunch of jokers over there,” Mr.
Bush said, referring to the members of the opposition bench.

Mr.
Bush said he had checked with Foster’s and Hurley’s grocery stores and that
neither indicated their individual item prices would be affected much by the
fuel import increases.

“There
is just no reason why an import duty increase of 25 cents a gallon should lead
to large supermarkets increasing prices,” he said.

The
premier also referenced a 2006 study on gas prices in Cayman, commissioned by
the former government, which indicated that the fuel mark up at the pump by
local retailers was one of the highest in the Caribbean. That review also found
that the Cayman Islands government import charges were among the lowest in the
region.

“As
the price of fuel has increased over the years, the government’s take has
decreased,” Mr. Bush said. “Tell the public what you found!

“They
didn’t want to hit – maybe their friends, maybe other businesses – with these
increases.”

2 COMMENTS

  1. Taxation without fair representation.. Citizens in the Eastern districts will bear the brunt of this new tax. With most business lumped in George Town they have no choice but to drive there daily to work. As for representation, the trend continues with the recommendation of adding ministers to the George town district.. I may be wrong but minister do vote on proposed policy.

  2. Just another reason to leave Cayman.

    The Pros:
    – no personal income taxes
    – sunshine
    – great communities and people

    The Cons:
    – government burying its own people to make up for its own mistakes.
    Which has lead to:
    – huge increase in crime
    – increase duties – gas, import, liquor etc
    – drop in housing prices and rentals
    – increase in companies re-locating
    – higher unemployment
    – drop in permits

    The breaking point is coming soon… I would sell my house at a discount to get out of here, but there are just no buyers…. and the forecast is only going to get worse.

Comments are closed.