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ACEP questions TOR debt levy

  • SOURCE: | qwesa2big
  • ishmael-ackah-720x520Energy think tank Africa Centre for Energy Policy (ACEP) has questioned the  payment of the Tema Oil Refinery (TOR) debt recovery levy, especially when revenue generated since its inception was enough to clear the existing debt.

    According to ACEP’s analysis, revenue generated from the levy, per estimates from diesel and gasoline sales, amounting to over GH¢1.2 billion (GH¢1,241,307,402.61) was enough to pay off the debt which had ballooned from GH¢450 million to GH¢900 million as of the end of 2009.

    The Energy Policy Advisor at ACEP, Dr Ishmael Ackah, in an interview said government must account for what had accrued and provide justification for the continued payment because the debt had been overpaid.

    “We propose that the Government of Ghana should account and provide justification for why consumers should continue to pay TOR debt recovery levy. We estimate that consumers finished paying the debt in 2015,” he said.

    He said currently, consumers paid eight pesewas per litre of gasoline or diesel with about GH¢136 million accruing into the fund in only 2015.

    “That is TOR debt recovery from both diesel and gasoline. It can be estimated that for the past 13 years, 2004 to 2016, we got GH¢1.2 billion. Remember these are estimates assuming gasoline and diesel consumption grows by 10 per cent annually from 2004,” he said.

    He, therefore, urged the new government to account for what had been collected and paid in line with Act 642, as well as ring fence the levy and pay off the debt.

    “It must also introduce a sunshine clause so that the levy will be abolished when we finish paying and ensure that it renders account every year to Parliament in line with the Act,” he said.

    No reports so far

    Dr Ackah explained that according to the TOR Debt Recovery Fund Levy Act 2003 (Act 642), the minister of Finance was supposed to present a status report on the fund, but that had not been done.

    “The minister of Finance is supposed to present the status of the levy, that is how much has been collected, how much has been spent and how much of the debt has not been paid. However, the minister has not complied with such requirement of the law. No finance minister since NPP One through NDC One and Two has complied with this provision,” he said.

    Why the Levy

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

    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.

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