Ghana: IES, COPEC Fight Gov’t Over Increment Of BOST Margin, Others On Petroleum Products

Energy Think Thank, Institute for Energy Security, is calling on the Akufo-Addo-administration to withdraw the increment in Petroleum Price Margins being introduced by the National Petroleum Authority (NPA) which is expected to take effect on Saturday, May 1, 2021.

The downstream petroleum regulator, NPA, in a directive to the Oil Marketing Companies (OMCs), asked them to revise the price of diesel and petrol effective today due to the passing of the Amended Energy Sector Levies Act (ESLA) which introduced 10 pesewas on both diesel and petrol and 20 pesewas each on a litre of diesel and petrol for Energy Sector Recovery Levy.

In the Memo, NPA also revealed that BOST Margin has been revised from the current 6 pesewas per litre of diesel and petrol to 12 pesewas. Unified Petroleum Price Fund also saw an increment from 27 pesewas to 30 pesewas, while Fuel Marking Margin levy increased from 3 pesewas to 8 pesewas with Primary Distribution Margin going up from 8 pesewas to 11 pesewas.

UPPF margin on a litre of LPG, which is currently 25 pesewas, had also been increased to 28 pesewas.

But these increments have been met with stiff opposition by IES, and Chamber of Petroleum Consumers (Ghana).

In a statement, IES said it finds these new amendments in the various margins as nuisance and insensitive to the Ghanaian petroleum consumer, particularly as the impact of the Covid-19 pandemic is still felt by the majority of Ghanaians.

The energy think thank said the fuel consumer is already burdened with several taxes, in the face of job losses, salary cuts and collapse of businesses et cetera; following the pandemic.

According to IES, it is inappropriate for the government to lay more burdens on Ghanaians through the amendments in fuel margins.

“The IES finds no justification for the increases in these Margins. For instance, the BOST Margin and the PDM goes to BOST, yet BOST has not been able to even properly justify the GHp3 per litre increase given it last year. The company is still under performing, as it was the year before…not much has changed.

“This action by government, through the National Petroleum Authority can best be described miscalculated, insensitive, careless and inconsiderate, looking at the times the country is going through.

“IES is, therefore, calling on the government and NPA to immediately withdraw the increased levies on the UPPF Margin, PDM, FMM and the BOST Margin to alleviate the burden on the ordinary Ghanaian citizen. It must be stated that there is no justification for these increase, and of course, counter-productive,” the statement concluded

On their part, COPEC accused the NPA of taking a unilateral decision by adding in excess of 3.2 percent on current pump prices in addition to the parliamentary approved 5.5 percent new taxes from the 2021 budget.

“This will lead to fuel price increments of about 8.7 percent on current prices.

“We believe the NPA, by this singular action and previous acts, is completely out of touch with the economic realities of the people who buy fuels in the country as that the NPA itself is simply becoming another burden on Ghanaians and will need to be reigned in by the appropriate Authorities from these arbitrary increases at a time as this when the harsh effects of Covid-19 on businesses and individuals is still raging.

“While it is on record the country is losing billions of Cedis in revenue to the fuel smuggling phenomenon and for which reason we think comprehensive efforts by the state should be directed at blocking the cartel engaged in this act to deliver the needed revenues to the state, we object to any attempts to simply continue adding taxes and unnecessary margins on the fuel price build up which only adds to the increasing hardships on Ghanaians.

“We are by this calling on authorities to reign in the NPA to immediately withdraw these new needless add on as any attempts to force these unilateral increases by the NPA using the backdoor on Ghanaians will be steeply resisted,” COPEC said.

Source: www.energynewsafrica.com