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Govt imposes 17.5% Tax on petroleum products

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The government has requested Parliament to approve a bill imposing a Special Petroleum Tax of 17.5 percent on petroleum products.

Finance Minister, Seth Terkper made the request when he presented the 2015 budget to Parliament on Wednesday.

Subsequently after reading the budget for the 2015 financial year, the Minister presented the bill to the Speaker under a certificate of urgency.

The Speaker immediately referred the bill to the Parliament’s Select Committee on Finance for consideration.

Joy FM’s Parliamentary correspondent, Elton John Brobbey says because the bill was presented under a certificate of urgency, the bill is expected to be passed into law by the close of day today.

The president of Ghana would be waiting to assent it when passed, Minority MP, Mark Asibe Yeboah said.

Minority MP and member of the Finance Committee, Dr. Mark Assibey Yeboah has expressed serious disappointment about the 17.5 percent tax on petroleum.

He described the tax imposition as “criminal” and vowed to “resist with my blood”.

His colleague MP for Okaikoi North, Patrick Boamah, said the decision is proof of government’s “disrespect” for Ghanaians, stressing that the government has taken Ghanaians for granted for far too long and should not be tolerated.

Meanwhile, the Minority Caucus has held an emergency meeting which they plan to reject the bill, Joy FM’s Parliamentary correspondent Elton John Brobbey reports.

But the NDC Member of Parliament for Madina, Alhaji Amadu Sorogho said the imposition is “rational”, arguing it is necessary for government to look for revenues that could easily be collected.

Weighing into the issue, Deputy Finance Minister, Madam Mona Quartey discounted the instant effect the 17.5 percent tax imposition would have on Ghanaians, explaining that it “would not have sharp and immediate impact” on the citizenry.

TAX POLICY MEASURES

Earlier, Finance Minister Seth Terkper announced that Ghana’s fiscal policy for 2015 “will be driven mainly by new tax policy measures, revenue administration reforms, improved public financial management, expenditure rationalization, and the implementation of new debt management strategies”.

The revenue generation measures, he said, will include extension of the National Fiscal Stabilisation Levy of 5 percent and special import levy of 1-2 percent to 2017; VAT on Fee-based financial services; and a 5 percent flat VAT rate on real estates; and increase the withholding tax on Director’s remuneration from 10 percent to 20 percent.

MACROECONOMIC TARGET

The specific macroeconomic targets for 2015 are as follows: Overall real GDP (including oil) growth of 3.9 percent; non-oil real GDP growth of 2.7 percent; end year inflation target of 11.5 percent; overall budget deficit equivalent to 6.5 percent of GDP; and gross international reserves of not less than 3 months of import cover of goods and services.

EXPENDITURE RATIONALIZATION MEASURES

Some of the expenditure rationalization measures to be vigorously pursued are: Continuation of net freeze policy on employment (excluding education and health) and non-replacement of departing public sector employees in overstaffed areas; full implementation of the Electronic Salary Payment Voucher (ESPV) System; and strict implementation of the existing price adjustment mechanisms for utility tariffs and fuel prices.

Source:Myjoyonline

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Reporting Oil and Gas project was launched on 4th June 2009atTakoradi, Western Region, Ghana by Penplusbytes (PPB – www.penplusbytes.org) with the vision of providing a one stop online information and knowledge about Ghana’s oil and gas sector
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