We are unable to reduce petroleum product taxes at this time – President Akufo-Addo
President Nana Addo Dankwa Akufo-Addo has stated that lowering tariffs on petroleum items is not in the national interest.
"Removing taxes on petroleum items will cut Government revenues by about four billion cedis (GHc4 billion)," he stated, adding that the plan was unsustainable.
"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 asked organized labor at this year's May Day celebration in Accra's Independence Square.
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 that Ghanaians are experiencing due to increases in fuel prices, food prices, and transportation fares.
As a result of insufficient domestic revenue collection, President Akufo-Addo stated the government is currently facing very severe financing conditions.
"In fact, some of the earnings from these same petroleum product taxes are used to pay some of the 700,000 public sector employees on the government's payroll."
The President stated that the administration is tackling the issue of rising fuel prices by putting in place policies that are successful in stabilizing the exchange rate, which is a major factor of fuel prices.
He also stated that the government was working hard to ensure a consistent supply and availability of petroleum products in order to avoid shortages in some bordering countries.
Even though Ghana is a small producer of crude oil, with a current output of 148,000 barrels per day, President Akufo-Addo reminded Ghanaians that "we are still a net importer of petroleum products."
"As a result, we remain sensitive to the price volatility of petroleum products on the global market."
The President, on the other hand, noted that intense efforts were being made to restore 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 pushing private companies to build refineries in the country, with one of them nearing completion and scheduled to be operational by the end of the year.