Mexican drivers face slight fuel hike in January

Fri Dec 21, 2007 5:37pm EST
 
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MEXICO CITY, Dec 21 (Reuters) - Mexican drivers will pay a tad more to fill up their tanks beginning in January, as the government implements a fiscal overhaul meant to expand the country's meager tax base.

Mexicans will pay an additional 2 centavos, less than a fifth of a U.S. cent, per liter of standard gasoline as of January, with another 2 centavos added each month for 18 months, the government said in the daily gazette on Friday.

Congress agreed on the gasoline price hike in a tax reform passed in September, but President Felipe Calderon delayed its implementation to avoid hurting the poor.

State-oil firm Pemex is the only company that sells gasoline in Mexico, and the government keeps the price low, currently 7.01 pesos per liter, about $2.45 per gallon.

In the United States, gasoline sold for about $3 per gallon on Friday.

Mexico's government has said the planned gasoline price hike should not lift inflation, currently at 3.68 percent, by more than 0.1 or 0.2 percentage points.

But wide discussion in the media about the price hike has raised concerns it could lead to increases in the prices of other products, as small business owners try to offset the expected hike in transporting goods and food. ($1 = 10.8250 pesos) (Reporting by Noel Randewich; Editing by Diane Craft)

 

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