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TOR Debt Recovery Levy overpaid — ACEP

By : Jessica Acheampong

The Africa Centre for Energy Policy (ACEP) has questioned the rationale behind the continuous payment of the Tema Oil Refinery (TOR) debt recovery level, as its analysis shows that revenue generated from the levy is enough to clear the existing debt.

The ACEP maintained that between 2009 and 2015, total collection from the levy was in excess of GH¢1.9billion, which was enough to pay off the debt which had ballooned from GH¢450 million to GH¢900 million as at the end of 2009.

Addressing a news conference in Accra, the Executive Director of ACEP, Dr Mohammed Amin Adam, said Ghanaians do not have to continue paying the levy.

“Our analysis shows that between 2009 and 2015, the total collection from the levy is in excess of GH¢1.9 billion. This effectively amortises the debt assuming an interest of 10 per cent. Ostensibly, the TOR Debt Recovery Levy has over the years been misapplied, aided by the weak oversight of Parliament,” he said.

 

The TOR Debt Recovery Levy was introduced by the government in a bid to clear the massive debt that hang on TOR as a result of under recoveries.

Dr Amin Adam also took a swipe at the Minister of Finance for failing to provide information on the fund to Parliament.

“Section 13 of the TOR Debt Recovery Fund Levy Act 2003 (Act 642) states that ‘the minister shall within three months after the end of each financial year, submit a report on the Fund to Parliament.’ The minister of finance, over the years, has failed to submit this report to Parliament, which reduces the Minister’s legal and moral authority to continue collecting the levy.

“ACEP would like to demand that the Minister complies with the law by submitting to Parliament a comprehensive report on the levy covering the period 2004 to 2014.”

The government through a certificate of urgency passed the new Energy Sector Levies Act (Act 899) in December 2015, which took effect on January 4, 2016.

The Act, which provides for the harmonisation of major energy sector levies and taxes, is expected to generate additional GH¢3.2 billion annually as revenue to the government on volumes of petrol consumption comprising Petrol, Diesel and Liquefied Petroleum Gas (LPG).

This, the ACEP said would put additional burden on petroleum consumers.

“The ACEP appreciates the need for citizens to contribute reasonably to support government programmes. Therefore, we do not oppose taxes; but we are of the view that imposition of taxes should be in sync with good governance practices of transparency and accountability rooted in broad consultation with citizens,” he said.

After the Act 899 was passed, Dr Amin Adam said, the Minister of Finance told Parliament that the effect of the levies would amount to a five per cent increase in the price of petrol, 2.9 per cent in the price of diesel and 1.74 per cent in LPG price.

“Our analysis on the contrary shows that the effects of the levies on ex-pump prices are much greater and punitive. We estimate that the levies have led to increase in the ex-pump price of petrol per litre by 33 per cent, 40 per cent on diesel per litre and 22 per cent on LPG per Kilogram,” he said. — GB

Source: http://graphic.com.gh/business/oil-gas/56104-tor-debt-recovery-levy-overpaid-acep.html#sthash.ZwBDedxZ.dpuf

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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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