President Akufo-Addo has stated that lowering taxes on petroleum products is not in the best interests of the country.
He claimed that the proposal was unsustainable because “removing taxes on petroleum products will reduce Government revenues by roughly some four billion cedis (GHC4 billion).”
Addressing organized labor at this year’s May Day celebration in Accra’s Independence Square, President Akufo-Addo said, “At this time, when we are determined to expand Government revenues to increase our capacity to finance our own development, can we afford to reduce tax revenues by four billion cedis (GH4 billion)?”
The President was responding to a request from Dr Yaw Baah, Secretary-General of the Ghana Trades Union Congress, for the government to suspend all taxes and levies on petroleum products in order to alleviate the current economic hardship experienced by Ghanaians due to the increase in fuel prices, food commodities, and transportation fares.
President Akufo-Addo stated that the government is currently facing very tight financing conditions as a result of insufficient domestic revenue mobilization.
“Indeed, some of the revenues from these same taxes on petroleum products is what is used to pay some of the salaries of some of the 700,000 public sector workers on Government’s payroll.”
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The President stated that the government was addressing the issue of rising fuel prices by enacting measures that were successful in stabilizing the exchange rate, which is a key determinant of fuel prices.
He also stated that the government was working hard to ensure reliable supply and availability of petroleum products in order to avoid shortages in some neighboring countries.
President Akufo-Addo reminded Ghanaians that, despite the country’s modest crude oil output of 148,000 barrels per day, “we are still a net importer of petroleum products.”
“We, therefore, continue to be vulnerable to the price volatilities of the world market for petroleum products.”
The President, on the other hand, stated that intensive efforts were being made to rehabilitate the Tema Oil Refinery so that it could contribute to the stabilization of petroleum prices, which he hoped would happen soon.
He also revealed that the government was encouraging private companies to build refineries in the country, one of which was 80 percent complete and was expected to be operational by the end of the year.
SOURCE: myjoyonline
