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Oil tax cut sends wrong signal: Mah

The calls for a cut in petrol taxes continue to grow louder, but the answer from the Government remains the same.
Nicholas Fang

Sun, Jun 22, 2008
The Straits Times

The calls for a cut in petrol taxes continue to grow louder, but the answer from the Government remains the same.

Cutting petrol duties and giving out subsidies are not the answer to soaring global oil prices.

Instead, National Development Minister Mah Bow Tan suggested modifying lifestyles to cut household energy bills.

Urging against subsidies, he said that even countries like China and Malaysia have started to re-think their policies on this.

Global oil prices recently soared to new highs of close to US$140 (S$191) per barrel, compared to US$40 per barrel in 2004. This year alone, crude prices have risen some 40 per cent.

The fresh calls for tax cuts here came this time from Tampines East residents during a dialogue with Mr Mah yesterday.

He explained that cutting the duty of about 40 cents for every litre of petrol would send the wrong signal to consumers about the real price of oil.

'Subsidising oil will not be right as it would encourage consumers to use more oil, which would drive up the price even more. We want to make sure that we pay the correct price for oil and tackle the problem in a sustainable way.'

This involves changing lifestyles and habits by car-pooling, using public transport, or just turning off lights and air-conditioning at home when not needed.

The Government is also implementing policies to encourage buildings to become more energy efficient, added Mr Mah.

At the neighbourhood level, town councils are looking into using energy-saving light bulbs in common areas to help reduce energy costs.

Another topic raised during yesterday's session which created a stir among residents was the issue of the Government's contributions to disaster-stricken Myanmar and China in recent months.

In response to comments that some Singaporeans felt 'short-changed' after hearing of the Government's donation of financial aid despite the current challenging environment, Mr Mah said this was part of Singapore's duties as a good global citizen.

'We have to play our part as a good neighbour and help those who are in need if we are to expect to be helped in the future should we need it.

'In any case, the Government has not given out significant sums of money. In fact, the bulk has been donated by individuals and companies.'

The Government gave US$200,000 (S$272,520) to help earthquake-hit Sichuan province in China and an aid package of the same amount to help Myanmar's cyclone victims. Public donations came to several million dollars.

'Singaporeans should not feel short-changed as the amount that has been given out in the form of handouts and rebates over the years far exceeds that given to our neighbours in need,' Mr Mah said.

nicholas@sph.com.sg

 

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