Rising crude prices expose flaws in 'One Ghana Cedi' levy - NPP MP

Collins Adomako-Mensah argued that the recent surge in global crude oil prices has exposed fundamental weaknesses in the controversial "One Ghana Cedi" fuel levy. According to him, the levy-introduced when crude oil prices hovered between $60 and $70 per barrel-was based on overly optimistic assumptions. He said, "We made the point clearly that crude oil prices are not within the control of government, and therefore decisions based on temporary stability could backfire."

Mr. Adomako-Mensah stated that crude oil prices have now surged beyond $100 per barrel. He maintained that the policy reflects a broader problem of using taxation as a primary tool to address structural challenges in the energy sector, adding, "It is not prudent to tax your way out of problems. What we are seeing now is the direct consequence of that approach." He acknowledged efforts by Bulk Distribution Companies (BDCs) to absorb some cost pressures. He also noted that the levy was introduced as an addition to existing charges meant to clear legacy debts in the energy sector. He argued that the justification for maintaining the levy is increasingly weak, with government indicating progress in settling these debts-including claims of clearing about $1.4 billion and ensuring timely payments to Independent Power Producers (IPPs).

Mr. Adomako-Mensah is calling on government to immediately scrap the "One Ghana Cedi" levy. He said, "Government must also come in and support the consumer by taking off the levy to bring prices at the pump to the barest minimum." He conceded that Parliament has limited authority to compel the Executive to repeal the tax, adding, "We cannot force government to repeal it, but we will continue to appeal and push for a reconsideration."