BASSETERRE, St. Kitts – WITH electricity consumers fussing about the Customs Service Charge (CSC) cost that they now have to bear, Prime Minister the Right Hon. Dr. Denzil L. Douglas explained that this has become necessary now that the government is being billed for and has to pay for its electricity consumption.
“The electricity company bills the government and the government has to pay. All those lights on the basketball courts, all those lights around the islands, in the highways, byways, on the streets, side streets, main streets, every single light is now being paid for by the government.
“The government has adopted a policy that it cannot continue to subsidise electricity services and cost. And so once the electricity department began to bill the government then the Customs Service Charge which was withheld for one year also had to be paid,” the Prime Minister said yesterday (Oct. 16) during his radio programme ‘Ask the Prime Minister’.
Late last week, the St. Kitts Electricity Company Ltd. (SKLEC) announced that as at August 2012 its customers would now have to absorb the CSC; a cost which it absorbed for the period August 1, 2011 and July 31, 2012.
Continuing his explanation yesterday, Dr. Douglas indicated that previously the decision was taken – in the protection of consumers – that electricity services would not attract Value Added Tax (VAT) or were customs duties applied to goods imported for use in that sector.
He further explained that “wherever duties are not paid, wherever taxes are not paid across our border for importation of goods, a Customs Service Charge however should be paid and this was the understanding with the company one year ago”.
But according to the Finance Minister, that fee was not applied “mainly because one year ago, the government was not being billed for all the services the company provides to the government. In recent times however, it has become necessary for the government to be billed…”
According to PM Douglas, the increase in bill amounts that customers expect to see owing to the additional charge which they are now called upon to pay, would not be significant.
“In fact, since August this has already been applied. And let me make it clear, the fuel surcharge, we said from the very beginning, the fuel surcharge part of your bill is going to fluctuate from time to time. It will fluctuate based on the cost of the energy that is being bought from outside in order to generate electricity therefrom…Your actual consumption of electricity has not been increased and it will not be increased.
“What has increased since August is the cost for purchasing fuel. And purchasing fuel is not only what is the actual cost of the fuel, but also the fees associated with handling the fuel as it moves through our ports and into the fuel tanks, where it is stored on land. It is all those costs which have to be taken into consideration and are being reflected in the fuel surcharge. And so it is the fuel surcharge portion of the bill that is reflecting the cost that is being paid by the company, which includes the Customs Service Charge and the actual price that the fuel has been bought for.”
