Government cannot afford to scrap taxes on fuel – Akufo-Addo
President Nana Addo Dankwa Akufo-Addo has disclosed that his government is shorthanded on cries of Ghanaians for fuel prices to be reduced.
President Nana Addo Dankwa Akufo-Addo has disclosed that his government is shorthanded on cries of Ghanaians for fuel prices to be reduced.
He said the plea to government to remove some of the taxes on fuel will be very difficult to implement because the country gets revenue from there.
Speaking at this year’s May Day celebration in Accra, the President said such an action will significantly affect the government’s revenues.
“Removing taxes on petroleum products will reduce government revenues by some GH¢4 billion. At this time, when we are determined to expand government revenues in order to increase our capacity to finance our own development, can we afford to reduce tax revenues by GH¢4 billion?” he quizzed.
He said the monies raised from taxes such as those on petroleum prices are what is used to pay wages and allowances of workers; hence withdrawing them could affect the payment of salaries.
“Government is currently confronted by very tight financing conditions, in the wake of inadequate domestic revenue mobilisation. Indeed, some of the revenues from these same taxes on petroleum products are what we use to pay some of the salaries of some of the seven hundred thousand (700,000) public sector workers on Government’s payroll.”
Nana Akufo-Addo said despite the government’s decision, it is adopting other measures to mitigate the situation, including stabilising the exchange rate, a key determinant of fuel prices.
“Government is also working hard to ensure reliable supply and availability of petroleum products, thereby preventing shortages, a phenomenon which is being experienced in some other neighbouring countries,” he added, stressing that Ghana being a net importer of petroleum products is exposed to the volatilities on the international market.”
“Intense efforts are being made to rehabilitate the Tema Oil Refinery, to enable it contribute to stabilising petroleum prices, which should see the light of day very soon. We are also encouraging private companies to establish refineries in the country, one of which is eighty percent (80%) complete, and is expected to be commissioned before the end of this year,” he added.
Earlier today, COPEC projected that petrol will sell at GHS 9.538 per liter, about 0.4% increase, whilst diesel will go for GHS 10.829 per liter.
According to the oil marketing companies, the increment can be attributed to developments from the international market that has seen prices of finished petroleum products go up marginally as well as supply issues with diesel on the local market.
