Coronavirus: Cut LPG price - Mahama to government

Former President John Mahama has asked the government to reduce the cost of Liquefied Petroleum Gas for consumers as one of the measures to mitigate the economic burden of Ghanaians during the lockdown period necessitated by the outbreak of coronavirus, which has, so far, killed eight out of the six hundred and forty-one confirmed cases with eighty-three recoveries.

At a presentation of food items to some twenty thousand vulnerable households in Accra, Tema, Kumasi and Kasoa, Mr Mahama said: “In the face of significantly lower global prices of crude oil, I reiterate my call for a temporary reduction in LPG prices to enable households opt for its use in these difficult times when their incomes have dwindled due to the lockdown”.

Just recently, the Liquified Petroleum Gas Marketing Companies Association of Ghana warned that the consumption of the product in Ghana will reduce drastically because of the high cost.

According to its Vice-Chairman Gabriel Kumi, it will do everything possible to ensure that the many levies, including the newly-introduced LPG Cylinder Recovery Levy, are removed.

The levy came into effect on Wednesday, April 1, 2020.

“We believe that Ghanaian consumers are being choked with many taxes on LPG; globally, LPG consumption is on the rise, LPG is the fuel of choice. LPG consumption, globally, is growing between 8 to 10% but in Ghana, we are stagnant because we keep a lot of taxes on the product, and we are not able to grow consumption. If we don’t start doing anything drastically about the LPG prices, consumption will start going down”, he pointed out

Further, he said: “Our association is prepared to do everything and anything to ensure that this levy does not stay. We are preparing to do everything and anything possible within the legal framework of our country to ensure that this levy goes off. In fact, our members are angry”, he told Citi TV.

Mr Kumi said before the introduction of the LPG Cylinder Recovery Levy, it had been calling on the government to remove existing taxes, and, therefore, they were shocked to see the introduction of a new tax at the time the price of the commodity was going down.

He added that the association is expecting the NPA to obey President Akufo-Addo’s directive of giving businesses tax waivers and a stimulus package, adding: “We have been appealing to them to take the taxes off.”

“We believe this is the time that we rather need to reduce the price of the product so that we can make it accessible and affordable to every Ghanaian.

“If you look at the price build-up of LPG, there is 5 pesewas per kilo of LPG margin that consumers have been paying for the past 20 years.

"Currently, that 5 pesewas per kilo brings in GHS1.2 million a month. We don’t know what that money is being used for”, said Mr Kumi.

He added: “We are sounding a caution to our regulator that we are demanding immediate removal of this levy from the price build-up of LPG. If they don’t do it and the time comes and we are taking any action, we are expecting the consumer, the whole country to support us."

Already, the NPA has been sued by the Chamber of Petroleum Consumers (COPEC) and the Consumer Protection Agency (CPA) for the introduction of the Cylinder Re-circulation Recovery Margin.