The Marketing Companies Association of Ghana is demanding an urgent removal of all taxes on liquefied petroleum gas.
According to the group taxes currently make up 23% of the cost of the product, a situation they argue is making laternative sources of fuel especially charcoal a much more economic option.
In a statement signed by its Secretary Justice Adu Mante, the LPG Marketer say the current prices will end up pricing low incomes homes out of the LPG market which is leading to a “massive decline in the use of the product.”
“For example in 2015 atypical 14.5kg LPG cylinder cost about GH₵48 and a bag of charcoal then was also GH₵40, whilst the bag of charcoal is now 45 cedis, the same 14.5kg LPG cost 80 cedis.”
“This is clearly in breach of the policy decision that influenced the introduction of and the push for the utilization of LPG, to replace wood and other unhealthy fuels,” they indicated.
The LPG Marketers also warn that the increasing price of the product will make it impossible for government to realize the aim of its trumpted Cylinder Recirculation Model (CRM).
Government intends to use the CRM to ensure that 50% of Ghanains have “access to safe clean and environmentally-friendly LPG for domestic, commercial and industrial usage by 2030”.
Even though they support government’s plans to increase LPG usage, the LPG marketers believe it cannot be realized as quickly as government thinks.
“This is because in the existing saturated market of the product, the only way to increase use is by creating access for new users.”
“Unfortunately, these same new consumers have no monetary incentive to abandon their cheaper optiosn and jump on the LPG bandwagon because it does not make economic sense to do so,” they stated.
The marketers believe government can reveerse the situation and drive down LPG prices by removing all taxes on the product.
source: Ghanamatters.com