Fuel tax may deplete petroleum fund, analysts warn

The Fund, which is used by government to pay petroleum retailers the difference between the administered and prevailing fuel prices, was last year said to be in excess, hovering around P600 million. However, economists say the amount will eventually be exhausted, as the government will be drawing down from it to cushion the possible impact caused by the tax.

An economic analyst at Motswedi Securities, Garry Juma said while the fuel tax will not have an effect on pump prices in the short term, there is a likelihood that the Fund will dwindle in the long run.