PM: Forex needed for medicine more than needed for cars

Prime Minister Dr Keith Rowley
Prime Minister Dr Keith Rowley

THE Prime Minister has responded to car dealers' complaints over measures in the budget negatively affecting the industry saying the use of foreign exchange (forex) to purchase medicine takes precedence over the purchase of vehicles.

On Monday, Finance Minister Colm Imbert announced the removal of tax concessions on the importation of private vehicles and that the permissible age of imported foreign used cars will be reduced from four to three years, along with a reduction in the importation quota by 30 per cent.

Imbert said there were too many cars in TT with annual importation being 250,000 private vehicles which was causing "serious leakage" of forex to the tune of US$400 million.

President of the TT Automotive Dealers Association Visham Babwah said removal of tax concessions will escalate vehicle prices and cause hundreds of businesses to shut down. Dr Rowley was asked about the dealers' concerns on Tuesday following the opening of the Diego Martin Health Centre.

He said all cars are obtained by foreign exchange expenditure and noted the drastic decline in foreign exchange earning. "I will simply say to the people in the car business, used car and new car and whatever, if I have a choice to make between ensuring we have foreign exchange to buy medicine for the hospital, I would restrict the expenditure on cars. Because one thing this country is not short of is motor cars. But we cannot be short of medicine for the hospitals."

He said adjustments have to be made and all will be affected, some far more than others. "As for used cars and new cars they are not the highest on the priority list."

"(With our deficit) something has to give. And it is all about priority, the options we choose and the wider national interest." Asked about a possible conglomerate taking over all NP gas stations, which have been put up for sale, he said that Imbert had made it clear that where NP has stations, the first option will go to the people operating it.

He recalled there was a time when the State did not own gas stations. "So let us stop behaving as though this is how it has to be and if it is not like that then 'oh God we go dead!'"

He said the model was being changed to better serve the country and Government will ensure the change does not worsen the situation or give any undue advantage or disadvantage. He said the consumer will now play a bigger role.

"You wouldn't go to a gas station where the price is highest, would you? If the price of oil goes up and takes the price of fuel with it you wouldn't run up and down in your car because you feel to drive. You would make a decision as to when you travel, how many people you carry, how often you travel (and) how much fuel you burn.

"So you now have the lever in your hand to determine how you can influence your fuel expense. And that is how the economy changes from a benign one where Government picks up the bill, doesn't matter how irresponsible you are, to one where you have some responsibility.

"And the same thing will apply with turning off the water, turning off the lights, driving up and down the road, because you now are going to be responsible for some of that cost," he said.


"PM: Forex needed for medicine more than needed for cars"

More in this section