DIESEL TAX ON TAXIS (Request for review)

Mr Goh Chee Wee asked the Minister for Finance and Minister for Health, in view of the substantial drop in demand for taxis after the introduction of the new fare structure and the consequent reduction of income of taxi drivers, if the Minister will consider reviewing or withholding the imposition of the taxi diesel tax.

The Minister for Finance and Minister for Health (Dr Hu Tsu Tau): Mr Deputy Speaker, Sir, it is premature for me at this stage to consider reviewing or withholding the imposition of a diesel tax on taxis. My colleague, the Minister for Communications and Information has already informed Members of the measures he is taking with regard to taxi fares. In my view, the diesel tax should be imposed in order to reduce the gross disparity in operating costs between petrol-powered motor cars and diesel-powered taxis. However, if in September the Minister for Communications should advise me that it would be desirable to have some flexibility as regards the imposition of the diesel tax, I shall, of course, give his views very serious consideration.

Mr Goh Chee Wee (Boon Lay): Sir, when the Minister said that he is prepared to review, does he mean that he is prepared to consider deferring the implementation of the tax, to introduce gradual changes or to even scrap the diesel tax altogether?

Dr Hu Tsu Tau: As I said, it is premature to discuss any of these measures until the taxi fare situation is settled.

Mr J.B. Jeyaretnam (Anson): Supplementary question, Sir, for the Minister for Finance. Does he not think that the proper thing now would be to revoke the decision to implement the diesel tax as in the view of the Ministry of Communications, there has been a totally unexpected drop in taxi drivers' earnings? And then consider whether a diesel tax should be introduced and, if so, by how much?

Dr Hu Tsu Tau: The answer to the Member for Anson is no.