Privately owned public service vehicle (PSV) operators are hoping that Minister of Finance Chris Sinckler will finally hear their cry and provide relief in the upcoming budget, expected to be presented to Parliament before the end of this month.
Complaining that they spend over $13 million a year to insure their vehicles – many of which are well over 20 years old – are road worthy for commuter safety, Vice President of the Alliance Owners of Public Transport (AOPT) Charles Layne is appealing to Sinckler to grant them duty-free tax concessions on new vehicles to replace the aging ones.
“To buy brand new vehicles is going to cause a lot of expenses with the banks and different things . . . but if we could get duty-free it will lessen the expenses,” Layne told Barbados TODAY, adding that operators also have to look for upwards of $15,000 a year for insurance for the ZRs and a lot more for minibuses.
“And then you have the taxes and so on, and then the parts . . . ruin your pockets because of the old vehicles. So we are looking at if we could get duty-free at least, that would help us to offset some of the expenses,” the PSV official noted.
Layne revealed that the island’s 400 ZRs spend some $4 million a year in replacement parts, while the more than 390 minibuses spend about $7.8 million.
In addition, he said, with each ZR having to change tyres at least four times a year at a cost of about $300 per tyre, this worked out to an overall $480,000 annually.
A similar situation applies to minibuses, which carry six tyres at $500 each, resulting in expenditure of $1.1 million, he explained.
The PSV owners and operators have long contended that while members of Barbados’ horse racing fraternity were granted duty waivers on parts imported for their automobiles, the people whose livelihoods depended on their vehicles received no such privileges.
They have also said they felt restricted in the face of rising costs because they were prohibited from charging higher fares, and that clogged roads were making it challenging to get people to their destinations, particularly when there are cruise ships in port.
It was an issue raised by President of the Association of Public Transport Operators (APTO) Morris Lee in February of this year when he told Barbados TODAY the 7,000 PSV operators would not give away their votes cheaply come the next general election if the political parties did not address their concerns in their manifestos.
Lee also suggested then that those vying to form the next Government must acknowledge that the regulatory structure was in desperate need of an overhaul, as the status quo was heavily skewed against owners and operators.
“You have PSVs on the road that are close to 35 years of age because the operators are forced to keep these vehicles for long periods of time because a new vehicle is $1/4 million. A duty-free bus would be under $100,000 but the duty is about 83 per cent.
“So therefore you paying that amount for the vehicle, you working for $2 as legislated and when you pay Value Added Tax on diesel, tyres and parts, you cannot claim back a cent because PSVs are not structured within the VAT system. We can only pay the VAT but we cannot get back anything. So the Governments have a lot of food for thought,” Lee stressed at the time.
However, demands for a fare rise have now been taken off the table, with Layne telling Barbados TODAY although a hike would be more than welcomed, piling on more expenses on an already overburdened population would be “a little tight”.
“We ain’t looking at the bus fares right now because we more of less looking at the economic situation in the country; and then you have a lot of people not working and some who working have to catch two buses everyday, and right now they are paying $8 a day,” Layne pointed out.