Accra, July 29, GNA - The ruling New Patriotic Party (NPP) on Saturday congratulated the Government for proposing to abolish the ad-valorem tax imposed in 1998 leading to cuts in prices of petroleum products.
The Party stated that Government had shown that it was prepared to sacrifice revenue to subsidise and cushion the people against the harsh effects of the current economic difficulties.
In a statement signed by Nana Ohene-Ntow, General Secretary, said the NPP found it appropriate to congratulate the Government for the decision to reduce its revenue and subsequently cut certain development projects.
"This certainly would affect Government's development agenda, thus jeopardising its popularity with communities and economic sectors that may be disadvantaged by the current decision.
"In spite of this political disadvantage, the Government has bitten the bullet and shown sensitivity to the plight of the people." The NPP said the government had shown that it had the political will to take tough decisions in the interest of the people, even if it went against its interest in mobilising revenue for economic and social development.
"The New Patriotic Party considers that the recent concern expressed by some of its top party officers and others in the media partly explains Government's decision to reduce taxes on petroleum products.
"This gives credence to the assertion that this Government is in fact a 'listening Government' and once again has demonstrated its sensitivity to the plight of Ghanaians."
The NPP noted that escalation of hostilities in the Middle East had contributed to the rising crude oil process and appealed to the combatants to observe an immediate ceasefire to save the world from further hardships.
Parliament on Friday gave government the approval to abolish ad-valorem tax of 15 per cent on petroleum products. Government has subsequently introduced a specific excise tax, Mr Kwadwo Baah-Wiredu, Minister of Finance and Economic Planning told Parliament, when moving for the House's approval. He said the measure would reduce the ex-refinery prices of petroleum products.
Mr Baah-Wiredu said this was to lessen the burden of skyrocketing prices of crude oil on the world market on the Ghanaian citizenry. "Government has decided to take appropriate measures to stabilize the local market by rationalizing the taxes and the price build-up, which is the only option available," he said.
The price of petroleum product in the country is determined among other things by the price of crude oil, cost of refining the crude oil, government taxes and levies and various margins for dealers and marketers.
Meanwhile, the House had amended the debt recovery of (Tema Oil Refinery Company Fund Act 2003 (Act 642) to replace the schedule in order to reduce the levy on petroleum products.
According to the old schedule, premium, which had the levy of not exceeding 640 cedis per litre would now have a levy not exceeding 500 cedis per litre, the kerosene levy has been slashed from 640 cedis per litre to 350 cedis per litre, while gas oil, whose levy was 640 cedis per litre, has been reduced to 500 cedis per litre.
The rest are marine gas oil from 640 cedis per litre to 500 cedis per litre, residue fuel oil from 640 cedis per litre to 350 cedis per litre, liquefied petroleum gas (LPG) from 640 cedis per litre to 500 cedis per litre and lastly premix would go down from 640 cedis per kilogram to 500 cedis per kilogramme. This would translate into the following prices as earlier announced by Mr Kwamena Bartels, Minister of Information and National Orientation: Petrol would sell at 40,000 cedis per gallon instead of the current 42,000 cedis per gallon; Kerosene from 34,000 cedis per gallon to 32,000 cedis per gallon; Gas oil from 38,000 cedis per gallon to 37,000 cedis per gallon and the price of LPG comes down from 110,000 cedis for 14.5 kilograms to 100,000 cedis.