Ghana proposes GHS 100 ‘eco-tax’ on petrol, diesel vehicles to drive green agenda

Ghana’s government is set to introduce a new annual tax of GH₵100 per petrol and diesel vehicle, signaling a strategic move towards incentivizing eco-friendly energy sources in the transportation sector. The proposed tax, currently under consideration in Parliament, aims to encourage the adoption of cleaner alternatives and mitigate the country’s carbon output.

In line with its commitment to climate-positive actions, the government is also eyeing a GH₵100 per tonne tax on carbon dioxide emissions for companies. This broader initiative aligns with global efforts to address environmental concerns and underscores Ghana’s commitment to offsetting its carbon footprint.

This tax proposal follows the recent decision to implement a zero-VAT rate on imported electric vehicles, a move outlined in the 2024 budget. By offering financial incentives for electric vehicles, the government seeks to propel the transition towards a more sustainable and environmentally friendly transportation landscape.

Finance Minister Mr. Ofori-Atta, previously vocal about the government’s plans to expand the Environmental Excise Duty, now aims to extend its coverage to encompass plastic packaging, industrial emissions, and vehicle emissions. This signals a comprehensive approach to environmental taxation, emphasizing a commitment to holistic climate action.

However, not everyone is on board with these measures. Minority Leader Cassiel Ato Forson has raised concerns, suggesting that the proposed tax on a wide array of vehicles, including commercial and private ones, as well as ambulances and motorcycles (‘okadas’), could exacerbate existing economic challenges in the country. Mr Forson has also criticized the tax waiver on electric vehicles, calling for the creation of a conducive environment for their adoption rather than premature tax imposition.

As Ghana navigates this delicate balance between environmental sustainability and economic considerations, the proposed eco-tax measures are expected to undergo rigorous debate in Parliament. The outcome will not only impact the nation’s green agenda but also set a precedent for similar discussions on a global scale.

Source:norvanreports