Fuel Chamber: freeze duty hikes on petrol and diesel, or else kill the market

Polish Liquid Fuels Chamber (PIPP) called for freezing excise duty on fuels in 2001, arguing that the increase in fuel prices resulting from excise duty hikes has caused a drop in gasoline and diesel sales. PIPP claims that the sales of gasoline, expressed in tons, in the first six months of June 2000 were 6% lower than in the respective period in 1999. In the case of diesel, the drop was even greater and reached 13%. Meanwhile, imports of gasoline and diesel dropped 41% and 22%, respectively. "Increasing the excise duty leads to an excessive increase in fuel prices and contributes to a decline in demand. The proposed 15% percent increase in the duty next year will bring an increase in fuel prices of zl.0.23 per liter", says Andrzej Szczesniak, the head of PIPP. According to the chamber the negative trend may lead to a further decline in demand for fuels and diminish budget revenues. The chamber is also asking that import licenses be scrapped in order to stop the slide in fuel imports. (Puls Biznesu, p.4) J.K.