Ghana: COMAC Renew Calls For Gov’t To Scrap LPG Taxes To Boost Access At GHiPCON

The Chamber of Oil Marketing Companies (COMAC) has renewed its call for the Ghanaian government to remove the 16% tax on liquefied petroleum gas (LPG), saying the move would make the fuel more affordable and increase consumption.

COMAC Board Chairman Gabriel Kumi, who is also managing director of Trinity Oil, made the call during a panel discussion at the 7th Ghana International Petroleum Conference (GHiPCON) in Accra.

Kumi said neighbouring Côte d’Ivoire had removed taxes on LPG and subsidised the fuel for rural households, helping to raise consumption to about 700,000 metric tonnes, compared with Ghana’s annual consumption of about 350,000 metric tonnes.

“We started consuming LPG before Côte d’Ivoire, but today they consume about 700,000 metric tonnes, while Ghana consumes about 350,000 metric tonnes,” Kumi said.

“That is because they have taken measures to ensure LPG remains affordable. In Ghana, however, we continue to tax it. Research has shown that if the government removes these taxes, consumption could increase by about 20%,” he said.

Kumi said the cost of refilling a 14.5-kg LPG cylinder, at about 250 Ghana cedis, remained beyond the reach of many households. He argued that a worker earning a monthly salary of about 1,000 cedis would have to spend roughly a quarter of their income on a single refill.

He urged the government not only to remove taxes on LPG but also to introduce subsidies for rural households to encourage cleaner cooking.

Kumi also called for an assessment of the government’s free LPG cylinder and improved cookstove distribution programme to determine whether it had achieved its intended objectives.

He said the free distribution of LPG cylinders would have a greater impact if the fuel itself became more affordable.