Economist at the University of Ghana, Prof. Godfred Bokpin, has supported calls for the government to reduce taxes on petroleum products, saying such a move would help cushion consumers amid rising fuel costs.
Speaking in an interview on Joy FM’s Midday News, the Professor of Finance and Economics said the current tax burden on fuel limits the benefits Ghanaians should enjoy from the recent strengthening of the cedi.
“Yes, I agree with ACEP on calls for government to review prices on petroleum products.
“I am sure within the circles of government they may be aligned to that as well because in the absence of geopolitical developments in the Middle East and the implications, we know that the price build-up of fuel prices, especially the level of taxes, compounds inefficiencies and prevents consumers from fully benefiting from the currency’s gains,” he explained.
His comments come as the government faces mounting pressure from the African Centre for Energy Policy (ACEP) and the Ghana Private Road Transport Union (GPRTU) to urgently review fuel taxes.
The calls follow surging global oil prices linked to ongoing tension in the Middle East, including the Russia-Ukraine conflict, which continues to push up local fuel costs.
Prof Bokpin noted that he had initially supported the introduction of the one-cedi fuel levy last year, given the exchange rate pressures at the time.
However, he believes current economic conditions justify a reassessment.
“Reducing or removing some of these levies could cushion consumers against external shocks and help stabilise transport and commodity prices,” he said.
He added that other countries have taken similar steps to protect citizens from global fuel price volatility.
Transport operators have also warned that failure to adjust fuel taxes could lead to higher fares, adding pressure on the government to act swiftly.
Meanwhile, Government Spokesperson Felix Kwakye Ofosu has indicated that the government may review fuel taxes and levies if rising global oil prices begin to place excessive pressure on consumers.
Speaking on JoyNews’ The Pulse, Mr. Kwakye Ofosu explained that fuel pricing in Ghana is determined by three key factors: international market prices, taxes and levies, and the exchange rate.
He noted that while global oil prices are beyond the control of government, authorities retain the ability to adjust domestic tax components to cushion the impact on Ghanaians.
According to him, any such intervention would be considered only if external shocks—such as a prolonged conflict in the Middle East—lead to sustained increases in fuel prices on the world market.
“If the world market price rises to a point where it imposes too much of a burden, government will have to keep the other components flexible to cushion the effect,” he stated.
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Source: www.myjoyonline.com