Fiscal duty up on fuel imports

THE Fijian Government will be raising revenue through an increased fiscal duty on the importation of diesel and petrol, which would gradually rise by 20 cents per litre.

This was announced by Minister for Economy and Attorney-General Aiyaz Sayed-Khaiyum while delivering the Supplementary Appropriation Bill 2020 COVID-19 Response Budget on Thursday.

“But thanks to a dramatic global reduction in the price of fuel due to a price war being waged between Russia and Saudi Arabia, Fijians will still end up paying lower rates for fuel than they do today,” he said.

According to the Economic and Fiscal Update, Supplement to the COVID-19 Response, Budget address it was mentioned the imports in 2020 was also projected to fall by 9.3 per cent led by declines anticipated in imports of mineral fuel because of fall in prices of crude oil, machinery and transport equipment, manufactured goods and food and live animals.

The budget addressed the muted global demand for oil amidst weaker global activity, widespread airline grounding, and shift by state actors to flood the market with supply had pushed down oil prices to around US$25 per barrel, with the likelihood of further declines in the coming weeks.

As mineral fuels made up one third of the country's import bill, this would have a positive, yet temporary impact on Fiji's trade balance.

The COVID-19 Response Budget also stated the recent strengthening of the US dollar and the temporary increase in the duty of fuel would to some extent offset the decline in fuel prices locally.