Minibus, taxi ridership must not pay higher fares says Minister Prashad
By Neil Marks
Guyana Chronicle
January 9, 2007
MINIBUS and taxi operators should not be charging increased fares because of the implementation of Valued Added Tax (VAT) Minister of Tourism, Industry and Commerce Mr. Manniram Prashad said yesterday, urging passengers to refuse to pay any increases.
Mr. Prashad also denied media reports that minis bus operators have planned a strike for higher fares, saying he met yesterday with the head of the public transportation association, Mr. Compton Giddings, who assured him that no such strike action is planned.
However, he said a meeting planned by the association for the Square of the Revolution tomorrow is meant for the operators to discuss the effect of the implementation of VAT on their service.
Mr. Prashad said there should be no claim by public transportation operators for an increased fare, since spare parts and tyres should be cheaper under VAT. He said before VAT, importers were paying a 30 per cent Consumption Tax; but with the implementation of VAT, they only have to pay a 16 per cent tax, and so the prices for these items should be reduced.
Further, Minister of Labour Mr. Manzoor Nadir, who formerly held Prashad’s position, said two years ago minibus operators agreed that they would not increase their fares unless the price for gasolene reached more than $1000 per gallon. At the time, he said, the price for gasolene was $820 and it now stands at around $749.
Minister Prashad said that the reduction in the price of gasolene should have meant that fares would go down, but this was never pursued by the Consumer Affairs Unit of his Ministry and he is calling for operators to be reasonable..
The call by Minister Prashad for commuters not to pay any increased fares came with the determination of Madhia minibus operators to begin increasing their fare from $5000 to $6000, because they said they needed to meet a $2000 increase for the ferry across the Kurupukari river.
The increase was announced by Mekdeci Mining Company which operates the Kurupukari crossing. However, Mr. Nadir argued that the $1000 increase by the Madhia operators cannot be justified, since when they carry 13 passengers per trip, it would mean they are making $13, 000 extra, whereas the increase in the crossing is just $2, 000. He said it is a clear case of passenger “gouging” and he urged passengers not to pay the increase.
Further, Minister Nadir added, the operating cost of a minibus is 15 per cent; and with the cost of spare parts and tyres expected to drop with the implementation of VAT, there should be no complaint that minibuses and taxi operators have to foot a higher operational cost.
As a result, Minister Prashad is urging operators to shop around and not settle for higher prices when some stores are charging the fair price. He singled out Silvie’s and Auto Supplies Limited as two of the Georgetown retail outlets complying with the VAT regulations and charging fair prices.
Mr. Prashad said that an investigation by officers from the Consumer Affairs Unit have found that some outlets are bent on creating confusion and are adding VAT to old prices which would have been fixed when the 30 per cent Consumption Tax was applied.