Emissions Levy will impact mobility and increase transport inflation – ILAPI boss

Executive Director of Policy Think Tank Institute for Liberty and Policy Innovation (ILAPI), Peter Bismark Kwofie, has suggested that the emission levy introduced by the government as a revenue mobilisation levy should focus on ensuring a clean environment.

The implementation of the Emissions Levy Act, 2023 (Act 1112) begins today, Thursday, February 1, 2024, the Ghana Revenue Authority (GRA) has announced.

The Act will impose a levy on carbon dioxide equivalent emissions on internal combustion engine vehicles.

According to the GRA, the move aligns with the government’s commitment to addressing greenhouse gas emissions.

It is also expected to promote the adoption of eco-friendly technology and green energy, contributing to improved environmental management and the control of air and water pollution.

However, Kwofie of ILAPI has disagreed with these points, saying that the emission levy will militate mobility and increase transport inflation.

In a statement, he argued that the new levy will further upend business growth.

In his view, the levy, just like the sanitation levy, is not the panacea to fighting climate change and a clean environment.

He further opined that the quality of fuel at the pump is questionable and the government hasn’t been able to protect consumers; hence, there is no basis for introducing the new levy.

Read his full statement below

Emission Levy is not science but a prickly tax.

Ghana is only satisfying the Climate change and its adjustment Mechanism which encourages countries to pass laws to reduce emissions. The emission levy will militate mobility and increase transport inflation. This will upend business growth.

There has not been any framework for green energy subsidies at the sea and airport on eco-friendly vehicles to be imported. Encourage eco-friendly vehicle use is not about taxation but removing the huge cost on importing such vehicles and providing tax holidays for charging stations.

In a country of unsustainable power supply with high cost of electricity, how can we use eco-friendly vehicles? A transitional plan is the key with affordable import duties.

Again, the quality of fuel at the pump is questionable and government hasn’t been able to protect consumers. Emission levy just as sanitation levy is not the panacea to fighting climate change and clean environment. Sanitation levy hasn’t achieved its policy intent and same as the emission levy.

It is a revenue mobilization levy over ensuring clean environment.