Private public service vehicles (PSV) operators are calling for an urgent review of domestic bus fares in light of the new fuel tax levy announced by Prime Minister and Minister of Finance Mia Mottley in last Monday’s mini Budget.
The new tax, which takes effect on July 1, replaces the road tax and is expected to raise $80 million annually. It is to be levied at a rate of 40 cents per litre of petrol, 40 cents per litre of diesel and five cents per litre of kerosene.
Delivering her mini-Budget in Parliament, Prime Minister Mottley however announced that commercial vehicles will still be required to register on an annual basis, but will now pay 50 per cent of the previous fees paid as road tax.
In a joint statement released today, the Alliance Owners of Public Transport and the Association of Public Transport Operators complained that they were not consulted on the measures, which are expected to have a significant impact on the sector.
Describing it as an “unfortunate oversight” the two associations said they were “eager to work with the relevant authorities” and were hoping to have talks with the Prime Minister, as well as the Minister of Transport and Works Dr William Duguid before July 1.
“The new fuel tax will be of great concern to us, so we want to speak about how this will affect our business in relation to our operations generally,” said spokeswoman Ingrid King, while pointing out that in terms of the annual registration, the provisions announced so far applied to commercial vehicles.
“Traditionally our sector is treated a bit different because of its unique structure so we do need to get some clarification on that. If the broad term of ‘commercial vehicles’ applies to us, or if we are going to be treated in a different subset,” she explained.
As for the controversial issue of a hike in bus fares, the spokeswoman said: “It is a call for a review. We have a position as to where we feel the fares should be, but of course all of this is said in the context that Government has a responsibility to do reviews in an appropriate time.”
Back in December, the International Monetary Fund had recommended an increase in local bus fares from $2 to $5, while zeroing in on the operations of the state-run Transport Board, which it said were currently restricted in terms of revenue collection.
However, the PSV spokeswoman acknowledged that the final decision on any such increase was up to Government, while arguing that the pending increase in taxes would severely affect their bottom line.
“They [Government] are the ones that have the ability to control the fares. The fares have been where they are at for roughly about six years and we have given them reasons and several proposals of things that can ameliorate what is happening in the industry.”
The operators are also seeking immediate clarification on a myriad of other issues, including permits, changes to bus routes and duty-free concessions.
“We are not saying that there might be any one answer that is proposed or that is given, but if we look at it in context, . . . we can make the operations smoother and less painful,” she said, adding that “transportation is the life blood and it is important to get these issues ironed out”.
When contacted this evening, Dr Duguid told Barbados TODAY a meeting has been scheduled for Wednesday with the operators to discuss their concerns. He said an update would be provided following those talks.