The government’s proposal of a new fuel tax has ignited public skepticism, as officials insist it won’t lead to higher pump prices—a claim many view as economically implausible. Critics argue that in a nation already grappling with inflation and cost-of-living pressures, any additional levy on fuel will inevitably trickle down to consumers through transport fares and commodity prices. While authorities paint the move as a necessary measure to boost revenue for infrastructure and energy sustainability, opponents say it reeks of fiscal desperation and could further erode public trust. The question remains: who really pays the price for “painless” taxation?
Finance Minister Dr. Cassiel Ato Forson has laid before Parliament the Energy Sector Levies (Amendment) Bill, 2025, seeking to increase taxes on petroleum products to address mounting energy sector debt.
The Bill, presented under a certificate of urgency, proposes raising the current Energy Sector Recovery Levy from 20 pesewas to GH¢1 per litre on petrol and diesel.
According to Dr. Forson, the new levy is expected to generate funds to clear a $3.1 billion energy sector debt and support fuel procurement for thermal power plants.
He assured that the recent appreciation of the cedi will absorb the impact of the tax increase, resulting in no significant net effect on consumers.
However, the proposed tax hike has drawn sharp criticism from the Minority in Parliament. Minority Leader Alexander Kwamena Afenyo-Markin accused the government of misleading the public by introducing new taxes under the guise of removing others.
“The government’s actions will further burden citizens, particularly in light of the current economic hardships,” he said.
Afenyo-Markin further called for greater transparency and accountability in tax policy.
In contrast, MP Mahama Ayariga defended the bill, stating that the levy is necessary to stabilise the energy sector and address the ongoing power supply challenges, commonly referred to as “dumsor.”
Presiding over the session, First Deputy Speaker Bernard Ahiafor referred the Bill to the Finance Committee.
The Committee will assess the urgency and implications of the proposed legislation before it is returned to the House for a final decision.
The outcome will determine whether the government’s bid to shore up the energy sector through increased fuel taxes will proceed, and how it may affect Ghanaians at the pump.
Last Updated on June 10, 2025 by samboadu
