Zero sum: Excise tax increase likely to offset gov't cut in oil import tariffs

High crude oil prices and an up coming fuel excise tax rise will erase any effect of the government's decision to scrap fuel import tariffs to lower retail prices and decrease inflation. Excise duty for fuels will increase starting Sept. 1 and the largest Polish oil producer and distributor Polski Koncern Naftowy (PKN) Orlen said it would be fully borne by customers. "I think that fuels will increase by zl. 0.05-zl. 0.07 per litre as of September," said Krzysztof Cetnar from PKN management. Fuel prices increased 14 times this year and dropped only 10 times increasing the overall price per liter zl. 0.4 more than in December 1999. Even if the government decides to abolish custom tariffs for imported fuels, it will affect prices after as many as ten months. Custom duties amount to 3% for fuels and 4% for oil. (Gazeta Wyborcza, page 18, Reuters)