Thursday, March 31, 2011

Strategic thinking

A recent joke goes like thus:
- "Did you get a raise?"
- "In fact, I got two! On my mortgage and my electricity bill...."

Well, more rate hikes and price hikes are coming and one of them is going to make a lot of people unhappy. According to the daily Dziennik, the state will have to raise the excise tax on diesel fuel by 10 percent next year apparently as an EU transition period expires. With fuel prices hovering above 5 (1.6$) zlotys per litre (at least in Warsaw), all diesel car owners will feel had since car dealers charged them extra for their diesel cars, claiming the higher cost will be offset by cheaper diesel fuel compared with normal petrol. Riiight.

Obviously one man is happy, who most likely doesn't own a diesel as he has a driver and a government-issued car: Finance Minister Jacek Rostowski. He, like the old Uncle Scrooge, can already hear the soothing cling of coins dropping into the vault called the state budget. It is so convenient for him that another preferential tax-related transition period ends and that he can put the blame on somebody else.

There is another twist. You see, on Monday Prime Minister Donald Tusk opened (with all due bells and whistles, ceremonies, hugs and kissess) "the biggest Polish industrial investment of the 21st century" at the Gdansk-based refiner Lotos. The company spent 1.4 billion euros to upgrade its production capacity of... diesel fuel. Yep. The very same diesel that taxes are now going up on and which will bound to see demand fall.

And, by the way, the state owns 53 percent of Lotos, right? Good thing they plan to sell it next year. That's strategic thinking for ya'.

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