Fin Min rejects ideas of cutting petrol excise tax

The galloping growth of oil and fuel prices have led some members of the government to consider lowering excise taxes. On Wednesday PM Donald Tusk and Economy Minister Waldemar Pawlak appealed to the Finance Minister to take this step, as has the fuel lobby.

"High fuel prices endanger the economic development of Poland. A moderate level of taxes will forestall the ruin of Polish companies," said Halina Pupacz of the Polish Chamber of Liquid Fuels (PIPP).

However, experts are skeptical and believe lowering taxes would have only a short-term effect and limit further rises instead of lowering prices. Another danger is that the move may benefit only fuel companies as they may not pass on the cut to consumers.

However, Marcin Zachowicz, spokesperson of Lotos, assures that "If such a decision of the government comes, the company will entirely take into account the lowering of the excise rate in fuel prices".

According to Deputy Finance Minister Jacek Kupica such a move was never envisaged and it would mean the 2008 budget could not be kept.

Sources: Puls Biznesu, Dziennik, Gazeta Wyborcza