Transport fares to Go Up by 20 percent
Drivers say increment in taxes and levies on petroleum products has reduced "our real income because we need to add more of our income to buy the same litres of products we bought in May this year. "
The Private Commercial Operators Unions in collaboration with the Ghana Private Road Transport Union, (GPRTU) expressed their disappointment over the government's decision not to reduce taxes and levies on petroleum products.
According to them, the result is likely to affect the increase of transport fares by 20%.
The transport operators are not comfortable in the manner authorities of the regulation are sitting aloof in all the hikes of the prices in the country. The stakeholders have revealed that they consume much of the product and that enables the government to get more money in terms of revenue mobilization.
In a joint press release issued by both operators on Tuesday, October 12, 2021 signed by the National Communication officer GPRTU, Abass Morro, "the government has been silent on these increments (taxes and levies on petroleum products) while the commercial transport operator continues to suffer because of government’s negligence and silence.
"We, therefore, urge government to review the taxes on petroleum products especially diesel and petrol since the taxes, levies or margin that go to government and its agencies make up Ghc2.43 on each litre of fuel bought."
Please read in detail the press release below:
JOINT RELEASE...12 /10 /2021
PRIVATE COMMERCIAL ROAD TRANSPORT OPERATORS AND G.P.R.T.U.
REDUCE TAXES AND LEVIES ON FUEL AND PETROLEUM PRODUCTS OR RISK 20% INCREASE IN TRANSPORT FARES.
The Private Road Transport Commercial Operators Unions together with the Ghana Private Road Transport Union (GPRTU) wish to express our genuine disappointment in the government for not putting in place any stabilization measure to curtail the hikes in fuel and petroleum products in the country.
This half-hearted attitude of government does not promote the welfare and income of persons in the commercial transport business even though commercial transport operators are the major consumers of petroleum and for that matter contributes mostly to the clearance of legacy debts in the energy sector through the Energy Sector Levy Act 2015 (Act 899) to Energy Sector Levy Act 2021 (Act 1064).
Our disappointment stems from the failure of the government to commit to its assurance to operators that it will continue with efforts to prevent a steep rise in input cost.
It was based on this assurance that members of the Ghana Road Transport Coordinating Council agreed to increase transport fares by 13% on 2nd June 2021.
The recent hikes in petroleum products especially petrol and diesel have led to an increment of 42 pesewas from May 2021 to October 2021.
This is because a litre of either petrol or diesel sold at Ghc 6.08 in May 2021 is currently being sold at Ghc 6.50 by the major oil marketing companies.
This means that the price of a gallon of either petrol or diesel has increased from Ghc 27.36 in May to Ghc 29.25 in October 2021, indicating an increment of Ghc1.89 per gallon which add more cost to our operations without any cost recovery interventions by the state or government of Ghana.
It must be noted by government that a commercial taxi driver who uses five gallons of petrol a day spends additional Ghc9.45, which is almost Ghc10.00 and the trotro driver who uses an average of 10 gallons of diesel a day spends additional Ghc18.9, which is almost Ghc20 daily since the increment.
These increments have reduced our real income because we need to add more of our income to buy the same litres of products we bought in May this year.
Aside the effect of the increment in petroleum prices on our daily sales, there have also been about 10% surge in the prices of spare parts we buy to maintain our vehicles.
However, the government has been silent on these increments while the commercial transport operator continues to suffer because of government’s negligence and silence.
We, therefore, urge government to review the taxes on petroleum products especially diesel and petrol since the taxes, levies or margin that go to government and its agencies make up Ghc2.43 on each litre of fuel bought.
This also implies that the commercial transport operator pays about Ghc11 to government when a gallon of diesel or petrol is bought and an average of Ghc55 per five gallons daily.
The trotro driver also pays Ghc110 for 10 gallons of diesel to government and its agencies daily. These taxes and margins or levies on the daily basis are higher than our daily returns making us poorer compared to other businesses in the country.
In this regard, we urge government to as a matter of urgency scrap the following taxes in the petroleum price build; Special Petroleum Tax (46pessewas/Litre), Price Stabilization and Recovery Levy (16 pessewas/litre), BOST Margin (9 pesewas/litre), and Sanitation and Pollution Levy (10 pesewas/litre).
We also believe that the Energy Debt Recovery Levy and the Energy Sector Recovery Levy should be merged and reduced to 30 pesewas per Litre.
We believe that the removal of these taxes will reduce the prices of diesel and petrol by Ghc1.20/Litre each.
If government does not remove or review the taxes downwards, then we will have no alternative than to increase our fares by 20% to recover the cost of our operations and debt we have incurred during these price increments.
National Communication officer GPRTU
PRO National Concern Drivers Association
Chairman Ghana Committed Drivers Union
Samuel Amoah National communication team member GPRTU
PRO True Drivers Union