With several measures in budget 2022 to ease the effects of the rising cost of living, the government has set aside the sum of $5 billion to meet the cost of the interventions to be implemented following these consultations.
Not only that, but the government also announced moves to extend the freight cost adjustment which started in 2021.
“It would be recalled that we implemented in August 2021 an adjustment to the freight cost component… rolling back freight costs to pre-pandemic levels. This had the effect of reducing the import duties, excise taxes, and VAT charged on imported items,” Finance Minister Dr. Ashni Singh recalled.
He reminded too that this measure was initially due to expire on January 31 2022 but announced that the governemtn will be extending the application of this adjustment until 31 December 2022.
This measure is expected to cost in the order of $6 billion in 2022.
He didn’t stop there and also announced reductions in the cost of fuel. Utlilising an existing and established mechanism, the government will be lowering the excise tax rate further on gasoline and diesel from 20 percent to 10 percent with immediate effect.
“It is well known that this Government established a mechanism whereby the excise tax on fuel is lowered when the world market prices for fuel increases. As previously reported, we used this mechanism twice in 2021 to lower the excise tax rate on gasoline and diesel from 50 to 35 and then from 35 to 20 percent,” Dr. Singh explained.
Other cost of living measures includes the arranging of monthly farmers markets at locations to be specified in East Berbice, East Coast Demerara, Georgetown, East Bank Demerara, and West Coast Demerara in the first instance, with the possibility of extending to other locations depending on the initial experience.
This, the government anticipates, will help farmers find ready markets for their produce, and help consumers benefit from the price advantage of buying directly from the farmer.