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REMOVE THE TAXES FOR IMMEDIATE FUEL TAX RELIEF Saturday, 16 May 2026

May 16
2 min read

The Prime Minister Hon. James Marape must abandon his K1 billion fuel subsidy scheme and take prudent advice to apply a blanket removal of import duty, excise, and all applicable taxes on fuel imports. This is fiscally responsible, constitutionally sound, and an economically proven path to restoring affordable fuel for every Papua New Guinean.

The Prime Minister's K1 billion facility is constitutionally irregular. Section 209 of the Constitution is unambiguous: no public money shall be expended except under, and in accordance with, a parliamentary appropriation. PM Marape disclosed today that K576 million was sitting idle in the Central Bank trust account, however, this has never been authorised by Parliament. This is not a bureaucratic failure, as the Prime Minister frames it. It is the predictable consequence of operating outside the law.

The fiscal arithmetic is compelling. Currently, import duty (8%), excise levy (approximately K0.22 per litre), and GST (10%) collectively add an estimated K0.55 – K0.65 per litre to the pump price. At a retail price of approximately K4.20 per litre in Port Moresby, full tax removal would reduce the consumer price to approximately K3.55–K3.65 per litre — a saving of over 13% without a single kina leaving Treasury's operational budget.

This is not untested policy. When fuel prices surged globally in 2022, Australia temporarily halved its fuel excise, delivering immediate relief at the bowser. Indonesia eliminates fuel taxes on subsidised grades entirely, anchoring social stability. Ireland reduced excise on petrol and diesel to cushion households during the European energy crisis. The Opposition’s proposal is in national interest and demonstrates orthodox, evidence-based fiscal responses used by responsible governments worldwide.

The Prime Minister must humble himself and take this advice instead of trying to reinvent the wheel and apply voodoo economics that only makes matters worse, whilst being “Mr Right” and blaming the public service for his own incompetence.

Further, the Prime Minister's subsidy scheme is crowding out essential services. A K1 billion facility places pressure on government cashflow and diverts liquidity from health, education, police, and infrastructure. Compounded with debt interest repayments, the cash flow constraints kill essential services. This is the same government that cannot pay nurses on time, cannot pay teacher’s entitlements, cannot stock rural aid posts, and cannot maintain the Highlands Highway, and is trying to deploy K1 billion outside parliamentary oversight to manage a problem that tax policy could resolve at zero budgetary cost. It is time for the Prime Minister to humble himself and listen to sound advice.

The Prime Minister must choose: govern within the Constitution and deliver structural reform, or continue the cycle of improvised spending that creates crises, not solutions. Remove the taxes. Respect the Parliament. Protect the people.

END

Picture courtesy of Hon. James Nomane, MP.
Picture courtesy of Hon. James Nomane, MP.

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