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31.10.2019 Oil and Gas

Gov’t Won't Bow To Pressures To Cut Taxes On LPG — Finance Minister

By News Desk
Gov’t Won't Bow To Pressures To Cut Taxes On LPG — Finance Minister

Government is not bowing to any pressure for a downward review in the taxes on Liquefied Petroleum Gas (LPG), Finance Minister, Ken Ofori Atta has stated.

He says, calls for a reduction or complete scrapping of the LPG taxes if heeded to, has the tendency to destabilize the economy next year.

Stakeholders particularly the LPG Marketing Companies Association of Ghana have on a number of occasions appealed to government to remove what it described as “nuisance taxes” on LPG to make the product cheaper and more accessible for Ghanaians.

But speaking on Citi TV's Point of View, the minister said such an expectation in the next budget will not be met since the government is not ready to compromise given its agenda to make 2020 a relatively stable year for more investments.

“No, [we won't reduce LPG taxes]. I think it should be a pretty stable year in which we have a sort of sustainable, stable and insecure environment as we build the platform for what I believe to be private sector-led investments. 2020 is going to be a stable year because we are now coming to be a manufacturing export-led economy.”

The government in the mid-year budget review announced an upward adjustment in a number of taxes in the hope of raising more revenues to execute government's programs and policies.

Finance Minister, Ken Ofori-Atta stated that the government is proposing an upward adjustment in a few levies including the Road Fund Levy, the Energy Debt Recovery Levy; and the Price Stabilisation and Recovery Levy to bring the ratios close to twenty-one percent to help bridge the financing requirements. High LPG taxes 'killing' Ghanaians, scrap it- Group to gov't

The LPG Marketing Companies Association of Ghana is lamenting the high cost of Liquefied Petroleum Gas (LPG) and the negative impacts consumers have had to bear over the past years.

According to them, the only way the government will be able to achieve its target to double the consumption of LPG by 2030 is to scrap taxes on the product – an appeal they want to be considered now without delay.

Vice-Chairman of the Association, Gabriel Kumi, is convinced that such action will encourage more people to patronize the product and bring respite to “the masses.”

“LPG is a product whose elasticity is high. It is a product for the masses and so if you want to increase consumption, what you do is that, you lower prices so that you attract a lot of people into the consumption net. The government has put 25 percent on LPG and it is not deregulated so we believe that a removal of all these taxes on the product will free up demand. We are making this appeal because of the enormous benefits this country stands to gain by pushing up the consumption of LPG.”

—citinewsroom

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