Excise, VAT taxes to replace C-tax on gasoline
Stabroek News
November 9, 2006
While diesel oil and gas oil will attract an Excise Tax of three per cent and VAT of 16%, gasoline will face a 25% Excise Tax and 16% VAT.
Diesel oil and gas oil currently face a 35% Consumption Tax (c-tax) while the c-tax on gasoline, which government has adjusted as the world market price for crude oil rose and fell, is at 50%. Just over three weeks ago, the c-tax on gasoline was 30%. The price of crude oil on the international market has dropped significantly from highs of over US$70 per barrel earlier.
It is not known whether there would be room for the adjustment of the Excise Tax as currently obtains with the c-tax, given the continuing instability of crude oil prices on the world market. The application of the VAT and Excise taxes is aimed at ensuring there is no net increase in taxation.
Excise Tax on diesel oil, gas oil, gasoline and a host of other products has been set by regulations laid out under the Excise Tax Act 2005. Before this act was passed and the regulations issued, proposals had been made for the Excise Tax on diesel oil and gas oil to be 20% and 16.38% on gasoline.
Taxes on tobacco products will also be reduced. Under the Act, cigars, cheroots, cigarillos and cigarettes of tobacco or of tobacco substitutes the Excise Tax will be 100%; these products will also attract the 16% VAT. Currently, the c-tax on tobacco products is 128%. Before the amendments there was a proposal for a 96.55% tax on tobacco products.
Beer made from malt will be liable to a 40% Excise Tax plus 16% VAT; undenatured ethyl alcohol of an alcoholic strength by volume of less than 80% volume; spirits, liqueurs, and other spirituous beverages 40% and other fermented beverages (for example, cider, perry, mead); mixtures of fermented beverages and mixtures of fermented beverages and non-alcoholic beverages, not elsewhere specified or included will be taxed at 40%.