Parliament Backs Fuel Levy Reform Bill | By Dominick Andoh
Ghana’s Parliament is moving to tighten oversight of subsidised petroleum products while safeguarding legitimate industrial users, following the Finance Committee’s recommendation that the House approve the Energy Sector Levies (Amendment) Bill, 2026.
The proposed legislation is aimed at closing loopholes in the downstream petroleum sector, improving tax compliance and eliminating pricing distortions that have enabled some businesses to exploit fuel subsidies for private gain, according to the Committee’s report.
For Ghana’s business community, particularly manufacturers, mining companies, logistics operators and other industrial fuel users, the Committee says the reforms are intended to preserve the benefits of government support while preventing abuse that has weakened the integrity of the subsidy regime.
The report notes that existing pricing disparities between fuel oil and other petroleum products have created opportunities for tax avoidance and regulatory arbitrage. Some beneficiaries have reportedly obtained subsidised products intended for industrial purposes before diverting them to higher-taxed uses for financial gain.
The proposed amendment seeks to remove these incentives by aligning the Energy Sector Shortfall and Debt Repayment Levy and the Road Fund Levy applicable to fuel oil.
According to the Committee, the broader objective is to strengthen government revenue while promoting fairness, transparency and efficiency across Ghana’s petroleum tax administration. It also argues that improved compliance will help address fiscal pressures facing the energy sector, including poor revenue collections, system losses, high generation costs and inefficiencies within state-owned enterprises.
To allay concerns from industry, the Finance Minister informed the Committee that the measure would not impose an additional net financial burden on legitimate consumers. Companies using fuel oil will initially pay the levy at the point of importation but will subsequently qualify for refunds through the Integrated Customs Management System (ICUMS), eliminating the traditional 90-day waiting period.
The Committee further concluded that the Bill would have a zero-net tax impact on taxpayers while ensuring genuine industrial users continue to receive support.
While the Minority expressed reservations over the government’s ability to promptly process refunds, the Majority accepted assurances that GH¢15 million has been allocated for the immediate implementation of the refund regime through ICUMS.
The Finance Committee ultimately recommended that Parliament pass the Bill, describing it as a balanced reform that protects government revenue, strengthens the downstream petroleum sector and supports legitimate industrial activity critical to Ghana’s economic growth.
Parliament Backs Fuel Levy Reform Bill | AviationGhana.com
