Fuel Tax

As part of my recent adventure into buying cars, I had to take into account the total cost of ownership for each car. This was where I had to make assumptions about the price of fuel. A lot of people kept telling my that Korean cars have bad engines that will makan minyak (eat fuel) as compared to Japanese ones. However, the Japanese ones were also priced slightly higher than Korean cars.

So, as part of my decision making process, I had to make certain assumptions about fuel prices. As global fuel prices have been steadily falling, it dawned on me that pump prices may return to the low values that we once enjoyed. Taking this into account, I ended up with the decision to buy the Hyundai instead of say, the Toyota Vios or Honda City (local cars were definitely out of the picture). If the fuel prices continued to stay low, my purchase would be justified.

However, as I had previously blogged, I am also not quite happy with the way that the government has to artificially depress our economy. One of the ways to allow people to survive with this artificial depression is to keep prices of commodities low, including oil. So, I would also like to see a raise in the oil prices, as long as it is accompanied by a raise in basic wages as well.

(As you can see, I am full of contradictions!)

That is why I am none to happy with the idea mooted by our Minister of Consumer Affairs that a floor price be set for petrol. His argument is that with the lower global fuel prices, our government no longer had to subsidise fuel and should instead, take some profits by enforcing a fixed margin for petrol companies. This idea just makes my head spin. The government intends to fix both the price of oil, and also the profit margins of these companies.

In effect, our government intends to behave like a thug and rape reap all the profits from oil. Unlike monopolies, our government has the force of law behind it. This smells to me like an abuse of power and it stinks. This is akin to a stealth tax as the people will be pouring money into the government coffers whenever they purchase oil at the pump. Let us just call it what it is, a fuel tax.