WASHINGTON, DC – AS the economic fallout from the war involving Iran continues to ripple across global markets, the government in Basseterre has announced a series of measures aimed at easing the burden on consumers, particularly at the fuel pump.
Since the United States and Israel launched strikes against Iran, Tehran has responded by attempting to disrupt shipping through the Strait of Hormuz, a key global oil route, while also targeting critical infrastructure across the Middle East. The developments have pushed oil prices above US$100 per barrel, and despite a ceasefire, prices remain elevated.
In Basseterre, fuel is now retailing at around $20 per gallon, prompting swift action from the government.
During a national address on Tuesday morning, Prime Minister Dr Terrance Drew outlined several relief measures to help cushion the impact.
“While we continue to plan for the long term, we hear your struggles in the short term and we are acting,” he said. “Effective April 20, 2026, your government is implementing the following relief measures, including reducing the excise tax on gasoline.”
The excise tax will be cut by 50 percent—from EC$1.95 per gallon to EC$0.98 per gallon—until July 31, 2026 in the first instance.
“That is your government absorbing $1.2 million to ease the burden on motorists, households, and the cost of getting goods to market,” the prime minister explained.
Additionally, the Customs Service Charge on gasoline will be reduced from 6 percent to 3 percent over the same period. This is expected to cost $600,000.
The government is also expanding incentives for alternative energy. All approved equipment, including solar photovoltaic panels, will be exempt from VAT, Customs Service Charge, and import duties until December 31, 2026.
He further announced that surcharges imposed by shippers will no longer be included in customs calculations for taxes and duties on imports.
Turning to broader consumer relief, the prime minister confirmed the continuation of discounted VAT rate days throughout 2026.
“For the Easter period, the discounted VAT rate day will be observed on Friday, April 17, 2026. For the back-to-school period, the discounted VAT rate days will take place on Friday, August 28 and Saturday, August 29, 2026. For the Christmas season, discounted VAT rate days will be held on Friday, December 11 and Saturday, December 19, 2026, with vehicles included,” he said.
Dr Drew emphasized that while the government is taking action, individuals also have a role to play. He also urged businesses to pass on the benefits of the tax reductions to consumers.
“When government reduces taxes, let those savings reach the people at the counter, because when our people can breathe, our economy grows—and that benefits everyone, including your business,” he added.
