Experts welcome implementation of fuel levy - Call for efficient use of proceeds
Some economic and energy experts have welcomed the implementation of the GH¢1 fuel levy, but have called for transparency and efficiency in the use of the proceeds.
Professor of finance, Godfred Bokpin, and the Executive Director of the Chamber of Petroleum Consumers (COPEC), Duncan Amoah, shared their views on the levy.
They spoke in separate interviews with the Daily Graphic on the implementation of the levy which was delayed for about four weeks and will now be implemented on Wednesday, July 16, this year.
Parliament on June 4, 2025, amended the Energy Sector Levies (Amendment) Bill, 2025, to impose a GH¢1 on every litre of petroleum products to raise additional funds to defray the $3.7 billion energy sector debts.
The bill proposed an upward adjustment in the Energy Sector Shortfall and Debt Repayment Levy to raise additional revenue, GH¢5 billion annually on average, to support the payment of energy sector arrears, reduce legacy debt and ensure a stable power supply across the country.
Implementation
On July 1, 2025, the Ghana Revenue Authority (GRA), which is mandated to collect the levy, fixed Wednesday, July 16, 2025, as the date for implementing the Energy Sector Levies (Amendment) Act, 2025 (Act 1141).
It said the decision was taken in consultation with the Ministry of Finance and the Ministry of Energy to allow for a comprehensive monitoring of global market conditions and safeguard recent gains in domestic fuel prices.
In addition, the move was also to allow the petroleum firms to recalibrate their pumps in line with the development.
In a statement issued on Tuesday, July 1, 2025, the Ministry of Finance said: “We are pleased to inform you that following thorough review of the prevailing market indicators and in line with the government’s commitment to ensuring stable economic conditions, the implementation of the Energy Sector Levies (Amendment) Act, 2025 (Act 1141) will now commence effective July 16, 2025”.
Effective July 16, 2025, light oils, motor spirit, super, petrol, PMI would sell for 1.95 from 0.95 and AGO/diesel would move to 1.93 from 0.93, with marine gas oil (MGO (local) will be 0.23 from 003. MGO (foreign) would now be 1.93 from 0.93, and heavy oil, heavy fuel oil (residual fuel oil-RFO) will now cost 0.24 from 0.04.
Transparency
Prof. Bokpin said there must be periodic updates of the utilisation of the proceeds and how other interventions in reforming the sector were all coming together to ease the burden on citizens.
“Without transparency and disclosure, people will not have much trust in government and government institutions.
“So, there has to be communication, transparency in how the proceeds will be utilised and also, more importantly, there should be transparency in the procurement of fuel,” he added.
Prof. Bokpin said the second quarter of the year had seen an aggressive strengthening of the currency that had led to a reduction in the price of petrol.
“You can see that there have been some savings that have been passed on to consumers.
So, to that extent, I have a soft side for the introduction of the levy,” he said.
Prof. further said that the nation needed financial resources to ensure reliable power for both industries and consumers.
“So, to that extent, a GH¢1 levy will not significantly dislocate the pricing outlook going forward,” he said.
Efficiency
For his part, Mr Amoah said the chamber would keep an eye on the efficient use of the levy, adding “you cannot collect these funds from the ordinary petroleum users and then dump the funds into unproductive ventures or leave the funds with the Finance Ministry to be applied to other causes that you have not requested for”.
Mr Amoah said that citizens would want to see some improvement and efficiency injected into the power sector.
“Any excuse whatsoever after collecting this money, I think that citizens will be right in kicking against the money altogether. At present, you could be raking in almost GH¢400 to GH¢500 million every single month per this levy,” he said.
