It is expected that fuel prices would decline by 70 pesewas following the revision of the tax.
This means a consumer would be paying about GH¢4.50 pesewas for a litre of petrol instead of GH¢4.67 pesewas beginning Friday, February 16, 2018.
President Nana Akufo-Addo is expected to assent the bill so that the adjustment could take effect in the next pricing window, which opens on Friday.
Dr Mark Assibey Yeboah, Chairman of the Finance Committee in Parliament, when presenting the Committee’s report observed that, pursuant to Order 1199 of the Standing Orders of the House, the Committee determined that the Bill is of an urgent nature and should therefore be taken through all stages of passage in one day.
He said the Committee came to the determination having considered that rising cost of petroleum products, or anything impacting businesses negatively is deserving of an urgent response.
He said the objective of the Bill was to amend the Special Petroleum Tax Act, 2014 (Act 879) and to provide for a change from an ad valorem rate to a specific tax rate on selected petroleum products.
Dr Assibey Yeboah also stated that the amendment of the Bill would result in an expected revenue loss to Government of GH¢47.90 million per annum.
He said the introduction of the Bill in Parliament was “sudden” due to recent changes in the international prices of crude oil, which development were not anticipated at the time of the formulation of the 2018 budget.
He said the passage of the amendment Bill would bring relief to consumers of petroleum products in the country.
Mr John Jinapor, Member of Parliament for Yapei Kusawgu in his contribution called on government to totally scrap the 15 per cent Special Petroleum Tax instead of reducing it to 13 per cent.
He said the reduction of the tax on a litre of petrol from 53 pesewas to 46 pesewas, meant a total reduction on a gallon of petrol is only 33 pesewas which is insignificant.
He said though government is expected to receive over GH¢2 billion from the ELSA arrangement it is only mitigating the suffering of petroleum consumers with a paltry GH¢47.90 million, which he described as irrelevant.
Alhaji Mohammed Mubarak Muntaka, Minority Chief Whip, in his contribution expressed disappointment at government for the marginal reduction from 15 per cent to 13 per cent.
He said Ghanaians “now know the character and behaviour of those who told them that when they get power they will scrap it”.
He explained the history of the tax, which was brought to help the NDC government to make up for the staggering and unanticipated drop in oil price on the international market.
The NDC administration had planned its 2015 budget on the estimated price of oil at 60 per cent per barrel, but the price fell below 30 per cent.
Alhaji Muntaka also described the decrease as “negligible as throwing a stone at an elephant’s thigh”.
“The elephant is not going to feel it. It is not going to impact the lives of Ghanaians in any way…I bet you, you will hear what the ordinary Ghanaian will be saying,” he noted.
He argued that the government has no reason to maintain the tax because the problem it was introduced to solve no longer exists.
Alhaji Muntaka said petroleum prices are above the budgeted $57 per barrel hence government was already making enough of its expected income from petroleum.
“If you are really mindful of the suffering of the ordinary Ghanaian, won’t you pass it on so that they will have a relief,” he queried the Majority MPs.
He expressed worry that politicians are losing the trust of the people over broken promises. “When we are in opposition and we say we want to do something let’s keep our word”, he said.
Mr Kwaku Kwarteng, Deputy Minister of Finance in his presentation debunked the Minority’s claim, arguing that, the NPP government since it assumed office has not introduced any new taxes on petroleum products.
He charged the NDC Minority to be consistent in their argument, saying that, people who not long ago supervised the introduction of the 17.5 per cent Special Petroleum Tax have now turned around to blame the NPP government, and urged the minority to do honest and fair politics.
“If you knew that the 17.5 per cent Special Petroleum Tax was not good for Ghanaians why did you introduce it” he questioned.
Mr Kwarteng also said the government in 2017 reduced the tax from 17.5 to 15 per cent, which he said was in line with its policy of reducing the cost of doing business as well as reducing the cost of petrol to consumers.
He explained that the new amendment is to change the tax from an ad valorem rate to a specific tax rate on selected petroleum products.