Chief Executive of National Petroleum Authority (NPA), Hassan Tampuli, has revealed the much-criticised 15% Special Petroleum Tax (SPT) charged consumers at the pumps will soon be made a specific tax.
The revelation by Mr Tampuli today, Saturday 10, 2018, follows a demonstration last week by the Chamber of Petroleum Consumers (COPEC) and the Industrial and Commercial Workers Union (ICU) against the tax and other petroleum sector levies.
The two organisations and the Minority National Democratic Congress (NDC) have been pushing for the abolition of the SPT and other levies on petrol and diesel on grounds that they have made the cost of the commodities expensive.
The NPA has held its ground about the taxes, arguing that the removal of the SPT for instance, would create holes in the government revenue, however, on Newsfile on the Joy News channel (MultiTV), Mr Tampuli said some “meetings” have been held on the contentious tax.
“One thing that we have all agreed on is that instead of making the Special Petroleum Tax a percentage of ex-depot price, we will rather make it a specific amount so that it does not compound any future increases in the prices and it will also help government to stabilise revenue when prices go down,” Hassan Tampuli told Newsfile’s Samson Anyenini.
The NDC government introduced the SPT in 2014 when the price of crude on the international market was hitting record low figures.
The government at the time felt that there was a need to introduce the tax to stabilise the ex-pump prices and to cushion revenue generated from the sector.
At the time, it was 17.5% but the current government under President Nana Akufo-Addo reduced it to 15% as part his administration’s effort to review and abolish some selected taxes. The current government explained that the review of taxes was part of efforts to move from the economy from tax-dominated to production.
Speaking further about the impending review of the SPT on Newsfile, Mr Tampuli said, “as at yesterday [Friday], we have been having meetings about when to do it. We didn’t need [the COPEC and ICU] demonstration to even let us know that is what we should do.”
He would not state a specific date when the SPT would be changed from an ad valorem tax to a specific tax, but hinted that it may happen “by the next pricing window”, which is usually the middle of the end every month.
He is confident falling prices of petroleum products on the international market in recent times would also translate into reduced prices in the coming days.