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Petroleum prices in the country are to see a marginal downward review following the passage of the Special Petroleum Tax Amendment Bill 2018 which was taken through a certificate of urgency in parliament on Thursday.
The Bill which sought to reduce the Special Petroleum Tax from fifteen percent to thirteen percent by amending the Special Petroleum Tax Act, 2014 (Act 879) and to provide for a change from an ad valorem rate to a specific tax rate on selected petroleum products, was hurriedly taken through all the stages of passage of law in one day to meet the next petroleum pricing window deadline of February 16, 2018.
With the new ammended law, ex-pump price of petrol is expected to go down by 3.39 percent whilst that of Diesel is also expected to go down by 4.14 percent. It is estimated that petrol price would reduce from the current GH 4.67 per liter to GH 4.51 per liter whilst diesel would also reduce from the current price of GH 4.67 per liter to GH 4.48 per liter.
However, that may not materialize if the Bill is not assented to by the President before the next pricing window.
According to observations contained in the Finance Committee’s report, the full impact of the price reduction will only be felt at the beginning of the next pricing window at the beginning of March 2018 if the deadline is missed.
The Finance Committee Chairman, Dr. Mark Assibey-Yeboah, informed parliament in the presentation of the Committee’s report that without government’s current intervention, the anticipated price reductions for petrol and diesel were only supposed to be 1.39 percent and 2.6 percent respectively effective February 16 under the current pricing mechanism.
The Minister for Monitoring and Evaluation, Dr. Anthony Akoto Osei, who moved the motion for the amendment of the Act on behalf of the Finance Minister, indicated that the move is in tandem with government’s aim of shifting the focus of tax policy from the introduction of new taxes to improving tax compliance as a basis for revenue generation.
While emphasizing that it was also part of moves to shift focus from taxation to production in order to stimulate economic growth and development.
The Committee in its report noted that the fiscal impact of the Bill would result in an expected revenue loss to government to the tune of GH 47.90 million per annum.
However, the minority group in parliament are dissatisfied with the rate of reduction in the face of the hardships that motorists are reportedly experiencing with the hikes in the petroleum pricing in recent past.
Contributing to the debate on the Floor of the House on Thursday, a former Deputy Minister of Power in the erstwhile Mahama NDC government and Member of Parliament for Yapei Kusawgu, John Abdulai Jinapor, labelled the 2 percent reduction in the Special Petroleum Tax from 15 to 13 percent as insignificant.
He called for the tax to be totally removed to show government’s commitment to the plight of motorists, especially the commercial ones since some elements of the current government, then in opposition, promised to remove taxes in the pricing module which often swell up the petroleum prices.
Source: Clement Akoloh || afriwakeradio.com