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Saturday, February 4, 2023

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Gas stations will legally demand $300 million from the Government for retroactive return of 5 cents of marketing margin

The Chamber of Distributors of Petroleum Derivatives will initiate legal actions for the Government to retroactively return the five cents that were already granted in October 2019, through Decree 883, as part of its marketing margin.

This return would be in the order of about $300 million trying to be assumed by the treasury. Additionally, the Chamber prepares a new peaceful sit-in for the next February 9 in the Plaza Grande of Quito and insists that a defining meeting be granted between its directors and the Ministers of Energy, Fernando Santos, and of the Economy, Pablo Arosemena. At this meeting, at least three points should be discussed:

  • Marketing margin improvement
  • That the State assume the cost of transportation
  • Elimination of double VAT withholding

With these statements, the members of the Chamber made known once again the discomfort they have at not seeing their repeated requests met, for several months ago.

Ivo Rosero, president of the Chamber, recalled that this January 25 marked the 20th anniversary of the establishment of a marketing margin to be shared between distributors, marketers and transporters, and which has remained frozen for two decades. That margin, which hasn’t changed in 20 years, is 16 cents for extra gasoline and 13 cents for diesel. These are figures well below what is charged in neighboring countries that have lower costs, because -for example- they have a lower wage burden.

The revision of this margin, through the increase of 5 cents, is one of the requests that are being analyzed between the Government and the distributors. This increase is independent of the retroactive claim that will be presented in these days. Rosero explained that since January 2022, the problem of distribution companies has been raised with data and documents. and government authorities have come to agree with them, but they have not yet made the decision to increase the amount of the margin, which, on the other hand, would represent some $166 million per year on the part of the treasury. Rosero clarified that the general public would not represent any additional increase. For him, this payment by the Government is viable because there was a rise in prices for the public that has meant income for the State of $1.7 billion.

Camddepe also made public the support for the claim made by the Association of Fuel Distributors of Manabí (Asodigma) in view of the serious financial situation that occurs mainly in rural stations and those that are located far from the dispatch terminals of Petroecuador. The issue of transportation is complex. He explained that gas stations in remote locations must pay up to $70,000 a year for transportation, which destroys any kind of potential profit. He also said that the State is already in charge of fuel freight for the province of Morona Santiago and should act accordingly with the rest of the territory.

On the third point, they ask that the VAT withholding that they make when they buy fuel at the terminal is reduced. This was obtained with a decision that the Government made this week. The VAT withholding for super gasoline has been lowered by 27%, 60% for extra and 50% for diesel. Rosero recognized that this helps them in terms of liquidity, but not in profitability. In any case, he explained that the request made by the distributors in this matter is to eliminate the presumptive VAT, that this presumptive VAT is gradually recovered when the customer purchases the product. But when they sell to the public sector, they also withhold VAT and this creates problems for them. He even said that many gas stations that have terminated contracts with the public sector have preferred not to renew them so as not to have these problems. The situation has reached such a point that in certain provinces, ambulances no longer have gasoline to operate. (YO)

Source: Eluniverso

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