Large number of MPs would cut fuel tax to keep pump prices in check

Many MPs support idea of general lowering of fuel tax, some call for more specific measures

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A considerable number of the 200 Finnish Members of Parliament are inclined to welcome the lowering of fuel tax as a measure of keeping the skyrocketing pump prices in check. In a Wednesday survey carried out by Helsingin Sanomat reporters, 162 of the country's MPs were interviewed. Eighty of them supported the idea of a fuel tax cut.
      Again, 52 MPs dismissed the idea outright, while 30 of the members directly or indirectly avoided answering the question.
      Despite the decisive "no" answer from Prime Minister Matti Vanhanen (Centre) and Minister of Finance Antti Kalliomäki (SDP), the ranks of the two biggest ruling parties are somewhat split on the tax cut issue. Ten of the 55 Centre Party MPs and 15 of the 53 SDP MPs would like to revise the fuel tax level.
     
The standpoint of the opposition MPs was more convergent. Only two of the 41 National Coalition Party (conservative) MPs would prefer not to meddle with the tax. The party is currently considering the possibility of an interpellation vote on the issue.
      At the other end of the spectrum were the Green League MPs, none of whom favoured the idea of a tax cut.
     
Those supporting the tax cut justified their view, for example, with the distress the high pump prices have caused to those who drive for a living.
      Some of the MPs argued that there are better ways to help professional drivers than a general tax cut. "For example, this year's last diesel tax instalment could be omitted", a few suggested.
      The Green League's negative standpoint towards the fuel tax cut was based on the notion that the consumption of oil should not be encouraged.
     
Fuel tax is a fixed sum and not a percentage of the retail price. The tax on one litre of gasoline is EUR 0.5876.
      To this must be added VAT at 22%, such that a litre of 95E selling at the pump for EUR 1.40 includes around 84 cents of tax or 60%.
      As the price set by refiners and filling stations increases, so the share of tax declines.


Previously in HS International Edition:
  Finland to dip into state oil reserves to ease US shortage (7.9.2005)
  Gas price spike will be immediate and abrupt at Finnish pumps (2.9.2005)

Helsingin Sanomat