Ghanaians must pay economic rates - Wereko-Brobby

Ghanaians must learn to accept petroleum taxes as a universal means of raising critically needed revenue for development, Dr Charles Wereko-Brobby, Chief Executive of the Volta River Authority (VRA) and Presidential Adviser said in Accra.

He said they must be prepared to pay economic rates for fuel because the days of government subsidies were over.

Speaking at a forum on utility pricing organised by the Ghana Institute of Management and Public Administration (GIMPA), Dr Wereko-Brobby said petroleum taxes constituted an important means by which developed countries generated revenue and it was that money which was used to extend assistance to developing countries.

As much as 30 per cent of the country's hard earned foreign exchange was spent on fuel imports, which went to benefit only private cars that constituted about 70 per cent of vehicles in the system.

Dr Wereko-Brobby said only a small proportion of fuel was used in productive activities to the benefit of the economy. "The people who contribute the foreign exchange, live in the rural areas and those in the cities who use it must be prepared to pay economic rates," the adviser said.

Dr Wereko-Brobby who was the leader of the United Ghana Movement (UGM) said the misconception that increase in fuel prices automatically leads to a hike in food prices must change, adding if there was any link at all it was minimal.

He called for a public debate and education to change such perceptions. Dr Wereko-Brobby's comments came barely a day after government announced the re-introduction of 15 per cent ad-valorem excise duty on fuel with effect from last Friday, August 17, five months after abolishing it.

A government statement, however, said the reintroduction "will not alter the existing ex-pump prices of petroleum".

Parliament reinstated the ad-valorem duty in July after the legislature abolished it in February following a motion the Minister of Finance, Mr. Yaw Osafo-Maafo brought to the House.

The 15 per cent ad-valorem excise duty of ex-refinery price averages 200 cedis per litre.