Remove all taxes on LPG if it can’t be subsidised – LPG Marketers Association urges gov’t

Vice Chairman of the LPG Marketers Association, Mr. Gabriel Kumi

Government has been urged to overlook taxing Liquefied Petroleum Gas (LPG) if it is to realise its quest of ensuring a sizeable number of Ghanaians have access to the product for domestic, commercial and industrial consumption in some time to come.

According to the Cylinder Recirculation Model (CRM), which is the implementation model for the National LPG Policy government envisages that at least 50% of Ghanaians should have access to safe, clean and environmentally-friendly LPG for domestic, commercial and industrial usage by 2030.

However, the Vice Chairman of the LPG Marketers Association, Mr. Gabriel Kumi, has said in view of the saturated market of the product, the only way to increase use is by creating access for new users.

“Unfortunately,” he stated, “new users have been priced out of the market, thus not being able to afford the product”. He therefore suggested that consideration should be given to removing all taxes from the product if government is not ready to subsidise it to create affordability.

The removal of taxes, he insisted, will significantly bring down the cost of the LPG and make it possible for the ordinary Ghanaian to afford it.

Mr. Kumi was speaking at the second edition of the 2019 regional stakeholder engagements of the National Petroleum Authority (NPA) in Kumasi, and revealed that the LPG Marketers Association intends to mount pressure to see this is done.

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He also opined that implementation of CRM will take a while to bolster the numbers employed in the sector, until consumption of the LPG increases.

“We have to ensure that the current 6,500 people that are employed in the sector are very fully absorbed, so that in when consumption starts going up it can boost the workforce,” he stated.

The regional stakeholder engagements are aimed at interfacing with the public on implementation of the cylinder recirculation model for the distribution of LPG.

The Chief Executive Officer of NPA, Mr. Alhassan Tampuli, in addressing the gathering among others reiterated that the policy seeks to develop a market-driven structure to ensure safety, increased access and adoption of LPG; and to enhance the capacity of existing regulatory institutions in order to enforce the new market structure’s regulatory requirements.

It is also to “ensure the existence of robust and standard Health, Safety and Environmental practices in the production, marketing and consumption of LPG; and ensure the sustainability of supply” among others.

He said the “Cylinder Recirculation model of LPG distribution will be implemented fully”, adding that the relevant licences will be issued and safety protocols will be keenly observed to ensure safety of the public.

He stated that a number of consultations have been done with various stakeholders, and efforts continue to ensure that others across the country are engaged.

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Mr. Tampuli further noted that among the things earmarked for implementation of the CRM is included: risk assessment of LPG facilities in 66-second cycle schools in the country; compliance monitoring of all assessed LPG refilling outlets, second cycle school facilities, and selected facilities in the value chain.

There are also plans to convert high-risk stations into cylinder distribution/exchange points, and undertake capacity building for NPA HSSE staff and industry groups on safety issues among others.

You will agree with me that over the years Ghana’s petroleum downstream industry has witnessed a number of unfortunate accidents as a result of the misuse and inappropriate handling of petroleum products, especially Liquefied Petroleum Gas (LPG).

The issue of safety has been high on the agenda of President Nana Akufo-Addo’s government, and this has culminated in introduction and implementation of the Cylinder Recirculation Model for LPG.

The Ashanti Regional Minister, Mr. Simon Osei Mensah, while commending the NPA for the stakeholder engagement series on the CRM, assessing the expectations of consumers, identifying Investment among others, also said it will facilitate an all-inclusive implementation.

He said it will also “help meet government’s goal of ensuring at least 50% accessibility to safe and environmentally-friendly LPG by the year 2030”.

The Regional Minister said there is a need to “implement the policy and assess how it solves the peculiar needs of the industry and consumers as a whole”.

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