Fuel Price Hike: COPEC reiterates calls for review of tax build-up

Following an earlier projection by the Chamber of Petroleum Consumers Ghana (COPEC),  prices at the pump may go up by at least 20 pesewas. 

Various Oil Marketing Companies (OMCs) have begun increasing their prices marginally. Some of these companies however, increased the price of fuel by just 5 pesewas, despite the price hike of the commodity on the international market.

Head of Research at COPEC, Benjamin Nsiah, said a number of the OMCs did not increase their prices as expected due to competition.

However, He said although this might serve the interest of consumers, he believes it will adversely affect OMCs and their operations, hence the need for a relook at the tax build-up of petroleum products in the country.

“For the consumer, it is good because competition is leading them to reduce their margins, but for the whole industry, it is somewhat challenging because the OMCs cannot do the appropriate investment that will lead to efficient, quality, and effective service delivery. Go round the country, and you would find out that some of the retail outlets of OMCs are in dilapidated conditions because there is not much investment there.”

He stressed that “we think that the government can only cushion the OMCs by varying the taxes on the price build-up so that the OMCs can also have that window of opportunity to also adjust their margins higher a bit to grow and improve the industry.”

COPEC’s earlier prediction was based on developments in the international oil markets due to the outbreak of the Omicron variant of COVID-19.

Economies are now beginning to open again after an earlier scare due to the discovery of the variant.

This had earlier led to a fall in the price of crude oil on the international markets, causing the commodity to sell for less than 70 dollars per barrel.

However, the price currently stands at over 81 dollars a barrel as it has become apparent that the Omicron variant isn’t as vicious as its predecessors.

Source: https://citibusinessnews.com/2022/01/fuel-price-hike-copec-reiterates-calls-for-review-of-tax-build-up/