With the price of gasoline in Colombia skyrocketing, the Conservative Party announced that it will present a bill that seeks to reduce fuel taxes -VAT, national tax, carbon tax and fuel surcharge-. Added together, these taxes represent 23% of the final price of a gallon of fuel, according to the former Minister of Mines, Amylkar Acosta.<\/p>\n\n
The purpose of the bill is to counteract the increase in gasoline prices that the national government is carrying out with the argument that it is subsidizing the rich.<\/p>\n\n
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Beyond what is stated in the bill, whose approval is uncertain, the Minister of Finance, Ricardo Bonilla, has insisted that the price of gasoline in Colombia will continue to rise. He also announced that the price of diesel will rise in the near future.<\/p>\n\n
In addition to households, which have seen how the gasoline hikes have directly affected their pockets, several sectors have raised the alarm as their work has been affected. Among them, the most important are home workers and couriers, as well as cab drivers and food and raw material transporters in rural and urban areas, who move their vehicles using this energy source.<\/p>\n\n
The price of gasoline in Colombia is high due to two main problems: first, its calculation is based on the international price of oil and, second, the high percentage of taxes per gallon of gasoline.<\/p>\n\n
Impact on the pockets of Colombians due to the price of gasoline in Colombia<\/h2><\/h2>\n\n
The price of gasoline has a significant impact on various aspects of the national economy. In individual transportation it affects vehicle owners, 79% of whom belonged to strata 1, 2, 3 or 4 in 2014, according to Raddar, a company dedicated to monitoring consumption. The same company estimates that in 2022, car owners in strata 1, 2, 3 or 4 will account for 90%.<\/strong><\/p>\n\n
But the increase in gasoline prices in Colombia not only affects cars for individual transportation, it also affects the food sector and small businesses that use family vehicles to trade their products.<\/p>\n\n
The current formula for determining the price of gasoline in Colombia includes the producer price (51%), national and territorial taxes (26%), biofuel (ethanol, 7%), distribution (10%) and other costs (6%), as reported by the Ministry of Energy.<\/p>\n\n
However, this formula presents two major challenges<\/strong>: the high percentage of taxes<\/strong> (a quarter of the tariff<\/strong>!) and the dependence on international prices<\/strong> denominated in dollars.<\/p>\n\n
The tariff model based on the international price<\/h2><\/h2>\n\n
During the government of Andr\u00e9s Pastrana, exactly in 1998, the criterion was adopted that Colombians would pay the price of oil according to its price on the international market, instead of basing it on the cost of production in the country.<\/p>\n\n
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