The Chamber of Oil Marketing Companies (COMAC) has proposed that the government temporarily suspend the additional GHS 1 Energy Sector Levy component. This measure aims to cushion transport operators against rising fuel prices and prevent permanent increases in transport fares for commuters. Dr. Riverson Oppong, CEO of COMAC, made this suggestion on Tuesday, July 28, during an interview on Asaase Breakfast Show.
This intervention seeks to reduce financial pressure on drivers, thereby avoiding the immediate transfer of increased fuel costs to passengers. Transport unions, including the Ghana Private Road Transport Union (GPRTU), have recently called for a possible 30 percent increase in fares. They cite rising fuel prices and other operational costs as the primary reasons for their demand.
Ghana's economy frequently experiences the impact of global oil price volatility, which directly affects local fuel prices and, consequently, transport costs. The Energy Sector Levy Act (ESLA) was introduced to address legacy debts in the energy sector. Adjusting components of this levy could provide a short-term buffer against external shocks. Such a move would align with previous government interventions aimed at stabilising key economic sectors during periods of instability.
Dr. Oppong stated, “In my personal logical understanding and opinion, I would advise the government to take that extra once it was added to cushioning the transporters. At least you meet them halfway.” He believes that the levy could be reinstated without significant public opposition once market conditions improve. He also questioned the basis for the GPRTU's proposed 30 percent fare increase, indicating uncertainty about its calculation.
A temporary suspension of the levy could offer immediate relief to both transport operators and commuters, preventing a further burden on household budgets. Decision-makers will need to weigh the fiscal implications of such a suspension against the broader economic benefits of stabilising transport fares. The government will monitor international crude oil prices and geopolitical developments, which significantly influence local fuel costs. Any decision will likely consider the potential for fuel prices to fluctuate, as observed over the past two months.
The current situation highlights the delicate balance between government revenue generation and consumer protection in Ghana. Stakeholders will be watching closely to see if the government adopts this temporary measure. This could set a precedent for how future temporary fuel price shocks are managed. The long-term stability of transport fares remains crucial for economic planning and household expenditure across the country.