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Shaw increases taxes on gasoline, cigarettes effective tomorrow

Thursday, May 12, 2016

 

KINGSTON, Jamaica – Minister of Finance Audley Shaw in order to fund his $1.5 million tax break has increased taxes on cigarettes, petrol and departure tax effective tomorrow.
Shaw, speaking Parliament on Government’s plans to finance the $580-billion budget and meet commitment to reduce personal income tax said that special consumption tax on petrol will be increased by $7.00 per litre.
The expected yield from the new gas tax is $6.489 billion for the remainder of the fiscal year.
“Knowing that the gas tax that we thought was there isn’t there, and fully realizing the urgency and the need out of the enlightened anticipation for the $1.5 million we decided that we simply must find the $12.5 billion to fund this [income tax] package,” Shaw told the House.
“We are increasing the specific consumption tax on cigarette from $12 per stick to $14 per stick effective May 13, 2016,” Shaw said adding that the tax would garner $574 million for the remainder of the fiscal year.
“At present a stick of cigarette costs $40 and let me send the signal now, there is no need for it to go beyond $45 dollars if $2 is added in taxes because we know the tendency out there in the market,” the finance minister cautioned.
Shaw said his administration is also introducing a special consumption tax regime for liquid natural gas and revising the regime for heavy fuel oil, effective May 13, with expected revenue of $1.415 billion for this fiscal year.
Departure tax will now be moved from US$20 dollars to US$35 and is projected to add $5.3 billion to help offset the revenue lost in the tax break.