St Lucia continues to cushion impact of global oil rise

St Lucia: Despite the 8.5 percent inflation rate, the largest in forty (40) years which is being experienced by the United States, St Lucia’s largest trading partner, the COVID-19 pandemic, and the Ukraine Russia conflict, the government continues to cushion the impact of rising global oil prices during the latest fuel prices adjustment on May 2, 2022, for the three (3) week period ending May 22, 2022.

The subsidies on the 20lb and 22lb cylinders of gasoline are being subsidised by $25.30 and $27.83, respectively. These subsidies represent an estimated $2.9 million shortfall in government revenue. Similarly, the government continues to provide subsidies on gasoline and diesel, where it collects $0.00 in excise tax on gasoline.

As previously stated by the Prime Minister, Philip J Pierre, “Shortfalls in revenue would have serious implications for the government’s already strained cash flow as well as its ability to meet critical expenditures in various sectors, including healthcare, education, social assistance, wages and salaries, and debt payments.”

“Collections from the excise tax on gasoline and diesel are needed to finance government operations, including providing supplies to hospitals and health facilities, the management of COVID-19, and the provision of educational equipment and supplies,” he added,

Notwithstanding the challenges, the government’s comprehensive and people-centric budget for 2022/23 is expected to ease the impact of the ongoing COVID-19, the Ukraine-Russia conflict, and its effect on rising inflation and global oil prices.