Kumasi: A tax analyst has suggested to the Government to consider consolidating all fuel-related taxes and levies and cap it at GHc 1.50, at the pumps. The government currently collects a total of GHc 3.00 on every litre of fuel purchased at the pumps, through the imposition of various levies, including the energy debt recovery levy, price stabilization and recovery levy, energy fund, and road fund levy.
According to Ghana News Agency, Mr. Benaiah Nii Addo, Executive Director of the Green Tax Youth Africa (GTYA), stated that consolidating all the taxes and capping it at GHc 1.50 at the pumps would help bring financial relief to citizens, as part of the government's resetting agenda. Speaking in an interview, Mr Addo expressed concerns about the high fuel prices in the country.
He highlighted that maintaining the Public Lighting and the National Electricity Scheme Levies at their current rates, along with the proposed imposition of a GHc 1 levy on fuel, would result in fuel levies and taxes accounting for about 40 percent of ex-pump fuel prices. Mr Addo noted that rising fuel prices, driven by excessive taxes and levies, have had escalating effects on transport, commodities, and service delivery, contributing to Ghana's ranking as the 12th most expensive country in Africa.
Mr. Addo emphasized that the poor and low-income citizens are the most affected by the high cost of living due to the current economic situation. He pointed out that although Ghana extracts oil and sells it on the world market, citizens do not benefit from the oil wealth and are burdened by excessive levies and taxes. To ensure citizens benefit from Ghana's oil wealth, he urged the government to take steps to reduce fuel prices to a single digit, while exploring other areas of revenue mobilisation.
Mr. Addo suggested that capping fuel-related levies and taxes at GHc 1.50 would contribute to making domestic fuel prices stable and affordable, preventing drastic increments that disproportionately affect low-income households. He also recommended the implementation of an automatic price adjustment mechanism to enhance retail price controls and minimise profit margins on transportation.
Additionally, Mr. Addo urged the government to recover state funds from politically exposed persons with questionable wealth sources and to strengthen regulatory and tax administration systems to minimise corruption. He noted that recovered funds could be redirected to public development priorities, easing the financial burden on citizens. He also called for revisions to the quarterly electricity increment mechanism and an increase in transparency in beneficial ownership, with strict penalties for multinational tax abuse.
Mr. Addo concluded by urging the government to prioritise consultations and stakeholder engagement in making economic policy decisions to ensure the implementation of appropriate policies for the benefit of all citizens.
