John Mahama ‘reveals’ why Akufo-Addo can’t remove petroleum taxes amidst economic hardship

Akufo-Addo engaged in reckless collateralization of various funds to satisfy current consumption needs

Akufo-Addo government has collateralized ESLA till 2035, John Mahama

John Mahama speaks on Ghana’s economy

Former President John Dramani Mahama has said the reason the government cannot remove taxes from petroleum products, in spite of the economic challenges the country is currently facing, is not just because it will not be able to pay public sector wages, as the president told workers in his address on May 1.

According to him, what the president failed to tell the workers was that some of taxes on petroleum products have been collateralised and monies already spent.

“…at the May Day address, the President stated that it is not possible to remove taxes off petroleum products because it will result in an inability to pay public sector wages. What he did not tell workers was that some of those taxes cannot be removed because they have been collateralized and the money has already been spent.”

One of such taxes which can’t be removed, according to the former president, is ESLA.

“ESLA, when it was introduced, had a 5-year lifespan to pay down legacy energy sector debts. Today ESLA cannot be removed as a petroleum tax because this government has spent the money upfront and has collateralized ESLA till 2035.” John Mahama said during his presentation at Kempiski on May 2, 2022

He added that but for the intervention of civil societies and NDC legislators, the government would have pushed the Agyapa Deal which seeks to manage the equity interests of Ghana in mining companies and receive royalties on behalf of the government.

“Thankfully, the strong will of the people, civil society and the NDC legislators applied the brakes to the Agyapa Deal. We must be determined to defeat the Agyapa Deal if they resurrect it – This can only be the actions of an ‘Agya boni’ and not an ‘Agya pa’.

“This grim economic situation has inevitably caught the attention of the global investor community and rating agencies leading to a total loss of confidence in our economy.” John Mahama added.

View his Timepath below: