TOR Debt Recovery Fund Levy unjustified – ACEP

The Africa Centre for Energy Policy(ACEP) has called for an abolishment of the Tema Oil Refinery (TOR) Debt Recovery Fund Levy Act 2003 (Act 642).

The centre has cited lack of compliance by submitting to Parliament a comprehensive report on the levy, which according to them, explains why authorities should discontinue the collection of the levy.

“Our analysis shows that from 2009 and 2015, the total collection from the levy is in excess of GH? 1.9 billion, which effectively amortises the debt assuming an interest rate of 10 per cent and, therefore, finds it difficult to comprehend why consumers should continue to pay this debt.”

The centre beliefs consumers have overpaid the TOR debt, Dr Mohammed Amin Adam, Executive Director of ACEP revealed at a news briefing in Accra.

Dr. Adam explained that at the time the levy was instituted, the total debt stood at GH? 450 million.He reiterated that by 2009, the total debt had risen to GH? 900 million due to non-application of the revenues to service the debts as well as interest accumulation.

He said the Minister of Finance misinformed parliament on the effect of the levies, which the Ministry insisted would amount to a five per cent increase on the price of petrol, 2.9 percent for diesel and 1.74 percent in LPG price.

“Our analysis, on the contrary, shows that the effects of the levies on ex-pump prices have led to increase in the ex-pump price of petrol per liter by 33 per cent, 40 per cent on diesel per liter and 22 per cent on LPG per kilogram.”

According to the energy think tank, the introduction of the special petroleum tax to the levies per the law constitutes double taxation, that would cost the consumer an estimated amount of GH? 675 million annually on petrol, diesel and LPG respectively.