Mexico is to postpone the introduction of a controversial 5.5-percent energy tax until 2008, Mexican President Felipe Calderon announced Wednesday.
During a televised speech from his official residence in Mexico City, the president said the tax would not come into effect this year, but he appeared to rule out canceling the policy by saying that it would help the government fulfill its economic and social tasks.
Although the Mexican congress passed the tax hike bill two weeks ago, it still requires Calderon's signature before it becomes law.
Nevertheless, this did not prevent the prices of several major natural resources from rising, with an increase of 0.61 percent witnessed over the past few weeks.
Calderon, however, downplayed the effects of the proposed tax on the economy, and said that international food price increases were to blame for the inflation hike. He went on to promise that his government "will do all it can to contain price spikes."
After the announcement, former presidential candidate Andres Manuel Lopez Obrador slammed the tax, saying that if Calderon halves the wages of senior civil servants, the country will have enough money and resources without having to levy more money from the people.
Source: Xinhua
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