The sting in the 2022-2023 budget came in the tail as Finance Minister Colm Imbert announced an increase in the price of super and premium gasoline by $1 and diesel 50 cents a litre.
The new prices for fuel are now $7.75 a litre for premium gasoline, $6.97 a litre for super gasoline, and $4.41 a litre for diesel.
The change will take immediate effect.
Imbert made the announcement in the final few minutes of a four-hour budget reading in Parliament on Monday.
He said government took specific steps to ensure that diesel, which comprises 40 per cent of the fuel consumption in the country and is the main fuel for public transport and transporting goods, remains shielded to some extent.
"We had lengthy discussions on how we should approach the question of fuel increase," Imbert said. "We thought of fully liberalising fuel prices and allowing them to be set by the market as occurs in most of the world, but that would have caused a huge increase in the price of diesel."
He said if government fully liberalised fuel at the pumps, the price of diesel would double.
Earlier in his presentation he said the fuel subsidy would be capped at $1billion per year, noting that the fuel price is affected by the market price of oil, shipping, handling, storage and other market prices. He said in countries such as Barbados, fuel prices are three times as high, but in Trinidad and Tobago prices are heavily subsidised.
He said with oil at US$90 a barrel the unadjusted subsidy would have cost the country about TT$1.9 billion and the difference in revenue would be better spent in social grants, where $5.4 billion is spent per year; food support, on which $175 million is utsed; disability grants at $630 million;, and social assistance grants, which cost $355 million.
Imbert said vulnerable members of society – senior citizens, people on public assistance for disabilities, and recipients of food support grants and social grants – would receive a one-time transport grant of $1,000, to be implemented on or before January 1 2023.