(MENAFN- Alghad Newspaper)
For the first time, economic commentators and spectators were able to understand the local pricing mechanism of fuel, and subsequently, know exactly how much revenue off it goes to the Treasury.
Until recently, the pricing mechanism and the state's income from fuels and oil derivatives has been a mystery; equally hard to explain or understand by specialists and citizens alike.
Notably, it was hard for Jordanians in general to understand because the information on it was not accessible to begin with, and not for any other reason.
This, naturally, created a suitable environment for inaccurate analyses, speculation, and rumour on the actual scale of revenue from fuel sales.
Likewise, for years too, we have been demanding access to this particular information; we have on more than one occasion inquired about it and demanded explanation by the government. But every time we asked the question the answer was the same: that it was too deaf and complicated, as well as lacking data, to be publishable.
In time, rumours intensified, and the costs of these rumours, aided by wrong analyses, was further public distrust in the government, until they finally published the information which outline the Kingdom's consumption of oil derivatives, and their median selling price.
Now we know.
For example, now we know exactly how much gasoline we consume, and the proportion of fixed and special taxes on it, in addition to sales tax revenues from the sale of oil derivatives overall.
Notably, it is no secret that fuel is an important source of income, which explains the price-ups recently, as opposed to the global drop in crude prices.
For instance, the government receives 16 and 24 per cent on 95-Octane sales in sales and private taxes, respectively, in addition to the fixed JOD0.095 on the litre.
Whereas for Octane 90, the government collects 4 and 18 per cent in respective taxes, and JOD0.055 on the litre.
That said, it is no longer as difficult, with some research and a little bit of calculation, to arrive at the exact amount of revenue for the Treasury, annually.
Jordan consumes an annual average of 4.984 million tonnes of oil, each equivalent to 7 barrels, for an average price per barrel of USD50 in 2016, at the USD-JOD exchange rate of USD0.71.
With that kind of information at hand, we can establish that Jordan spends roughly JOD1.238 billion, including fees and refining costs.
Based on that, by deducting the above number from the announced revenue disclosed by the government, which is around JOD2.6 billion, we can somewhat easily arrive at an accurate estimate of the Treasury's net income from the sale of fuel and oil derivatives.
The point here is not to complicate the issue for readers, quite contrarily. The aim here is to state that more information, further transparency and communication, would suffice to put all rumours out, and dismantle whatever setting that allows for the rumours to spread.
Responding to rumours with information, logic, and actual, true figures, supports and reinforces the credibility of the government.
By keeping this up; making information available, putting it out there for the public, and explaining it to the public opinion, the government uproots the source of rumour and inaccurate analyses, which is basically the lack of concrete information.
The truth is that the shortest path to the public's hearts and minds is transparency and open communication.
Either that, or the suppression of information, which will only make the public's perception of the public institution worse.
From now on, the pricing of fuels and oil derivatives is no longer a mystery.
The government successfully put many rumours to sleep, by making information available, and it is highly recommended that they keep it up.
This article is an edited translation from the Arabic version, published by AlGhad.
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