Algeria: Collection Of 6,100 Billion Centimes (DZD) Through Fuel Price Hikes

The Government hopes to raise the price of all kinds of fuel so as to collect 6,100 billion centimes (DZD) by next year, while preliminary estimates pointed to the need of for executive branch to earmark 10 billion dinars, or about 100 billion dollars to complete the stalled development projects, which are expected to be financed through loans provided by the Bank of Algeria to the Public Treasury as part of the acquisition of the latter’s bonds.

 The Ministry of Finance estimates in the draft state budget law for the coming year that the public treasury will be able to review the pricing of various fuels that will range between 2 and 5 dinar hikes depending on the type of fuel, and this resulted in the procedure related to the increase in the fee of petroleum products so as to bring additional revenues to the Treasury, estimated at 61 billion Dinars, or 6,100 billion centimes.

These revenues will stem from the fee on petroleum products, including 21 billion dinars from the collection of the fee on imported petroleum products, or about 2,100 billion centimes, at a time when the state treasury will collect additional revenues of about 15.6 million Dinars, that is more than 1,500 billion centimes, due to value added tax, including 4 billion dinars of value added tax pertaining to imports.

The Ministry of Finance has set conditions for the collection of the domestic value added tax on local products estimated at 1,200 billion centimes.

The Ministry of Finance figures also referred by the same token to a 50 per cent hike in the figures for self-consumption of energy and tariff adjustments for all environmental charges. 

All of these revenues will be directed to shoring up the state budget. These increases were confirmed by former Minister of Finance Mr. Abderrahmane Benkhalfa who alluded to economic feasibility for the development of projects, as well as the need to expand the tax base for practitioners of trade outside formal frameworks.

Mr. Abderrahmane Benkhalfa hosted by the National Radio on Monday, praised the efficiency and cost-effectiveness of the newly-introduced wealth tax contained in the Finance Bill for the coming year which is now being discussed by MPs during preliminary sessions at the national people’s assembly.

He pointed out in the language of figures that the increase by a very small percentage does not exceed 0.5 percent in the value added tax.

Algeria’s need to collect 10 billion dinars or 100 billion dollars comes in the wake of detailed explanations given by Prime Minister Ahmed Ouyahia while expounding the government’s plan of action before the two houses of Parliament.

The Premier stressed that the three development programs of successive presidential mandates consumed about 800 billion dollars in numerous projects’ implementation.