KINGSTON, Jamaica — Opposition spokesman on Energy Phillip Paulwell is again calling on the Government to immediately remove the hedge fund component of the Special Consumption Tax (SCT) on fuel and the General Consumption Tax (GCT) on electricity bills to ensure a reduction of fuel prices at the pump and the lowering of light bills which are now up by almost 10 per cent.

He said that while the increase in electricity prices may also reflect the ongoing devaluation of the Jamaican dollar, the portion of the SCT which was intended to finance the Hedge Fund continues to be a significant contributor to high energy prices. This, he said, is particularly egregious as the Government has bought no oil hedge insurance for the past four years.

“The continued pass through of these taxes to end users is causing additional burden to the Jamaican consumers at a time when many have lost their incomes and businesses, and are struggling to make ends meet due to effect of the COVID-19 pandemic on the economy, Paulwell said.

He added that with the closing of schools and children receiving instructions through online platforms, domestic energy usage is increasing significantly as households are using more electricity for Caribbean Examinations Council (CXC) and other academic preparation.

According to current public information, Paulwell said Jamaica Public Service (JPS) customers are experiencing an average increase of some 7.3 per cent on their electricity bills due to the rapid devaluation of the Jamaican dollar and the fact that Petrojam prices are not falling in line with world market trends.

The JPS has also announced that it is using $142.95 to US$1 to calculate customer bills for the month of May.

“In light of the reduction in fuel costs globally, which should have resulted in purchasing prices being at the lowest they have been in decades, I am calling for the removal of the hedge fund component of the SCT and the GCT for the benefit of lower oil prices to be passed on to electricity consumers”, he said.

Paulwell said the SCT was in part, put in place to establish a hedge around the skyrocketing oil prices to protect Jamaica from the unpredictable global fluctuations in fuel costs. He noted that despite refusing to re-establish the protective oil hedge, the Government continues to collect this tax.

“It is hard to imagine that Jamaican consumers and businesses can continue to bear increases in energy prices in the present circumstances. It is full time that they benefit from lower international oil prices,” Paulwell said.