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02.08.2005 General News

Govt reduces petroleum debt recovery levy - CJA

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Accra, Aug. 2, GNA - The Committee for Joint Action (CJA) on Tuesday claimed that Government has finally yielded to public pressure and reduced the Tema Oil Refinery (TOR) Debt Recovery Levy on fuel with effect from July 15, this year..

Mr Ato Ahwoi, a CJA leading member, told a press conference on Tuesday in Accra dubbed "The NPP Position is crumbling-victory is in sight, the New petroleum price build-up formula," that the Government did the reduction without announcing it publicly.

Mr Ahwoi noted that on July 15 this year the Government circulated a new petroleum price build up to the Oil Marketing Companies and failed to announce the changes despite public outcry about the fuel price increases since February, this year.

He said: "Government has reduced taxes and levies to 2,754,30 cedis per litre or 12,394.38 per gallon, a reduction of 98.1 cedis per litre or 441.45 cedis per gallon.

"Specifically Government has reduced TOR Debt Recovery Levy on petroleum by 462.52 cedis per gallon or by 16 per cent," Mr Ahwoi said. "The levy on diesel has been reduced from 2,880 cedis per gallon to 1,317.73 cedis per gallon a decrease in tax of 1,562.27 cedis per gallon or 640.00 per litre to 292.83 cedis per litre a reduction of 347.17 cedis per litre,"

Mr Ahwoi said: "Government's revision of the price build-up is a tacit admission that all along Organised Labour, the CJA and many others campaigning for a reduction in prices through reduced taxation were right and the NPP administration was misleading the public."

The CJA in March this year embarked on series of demonstrations dubbed "WAHALA Demonstration," against what they termed "bad governance, mounting economic hardships and the insensitivity of the New Patriotic Party (NPP) Government" in increasing fuel prices by about 50 per cent. The CJA, comprising a number of opposition political parties, democratic organizations and civil society groups, said it was leading the street protests for a review of taxes and margins.

Government had also increased the ex-refinery price of petrol by 441.45 cedis per gallon - from 13,645.17 to 14, 086.62 to account for increases on crude oil prices over the last five months (from 42 dollars per barrel to 60 dollars per barrel) However, Government had maintained margins paid to primary and secondary distributors at 782.00 cedis per litre or 3,519.00 cedis per gallon.

Mr Ahwoi urged the public to discount the Government's scare mongering, which sought to create the impression that there was the need for another increment of petroleum prices.

"The reduction is a clear demonstration that Government can accommodate higher ex-refinery costs while achieving stable ex-pump prices, which currently remains at 30, 000.00 cedis." He said the CJA had kept its focus and argued consistently that any fuel price increases would be unjustified despite rising crude oil prices.

"We have maintained that the existing levels of levies and taxes if adjusted downwards would more than compensate for the hike in crude oil prices.

"Our position has been vindicated by the reduction of the TOR Debt Recovery Levy in the new price build-up, which has kept petroleum product prices where they are despite the fact that crude oil prices now hover around 60 dollars per barrel.

"We wish to state without fear of contradiction that the WAHALA struggles has forced the NPP Government to admit without saying so publicly that taxes and levies on petroleum products can indeed be reduced," Mr Ahwoi stated.