News:
August 3, 2026
Parliament has passed the Energy Sector Levies (Amendment) Bill, 2026, amending the Energy Sector Levies Act, 2025, in a decisive move to strengthen revenue mobilisation and clamp down on widespread abuse within the country’s fuel subsidy regime.
The amendment raises the Energy Sector Shortfall and Debt Repayment Levy (ESSDR) on fuel oil from GH¢0.24 per litre to GH¢1.93 per litre, bringing it in line with the rate applied to diesel and marine gas oil. It also extends the Road Fund Levy to fuel oil.
Presenting the bill in the House on Friday, Finance Minister Dr Cassiel Ato Forson stressed that the government was not introducing a new tax on ordinary Ghanaians and that the changes would not increase fuel prices at the pump. He explained that the amendment was necessitated by a tax evasion scheme in the downstream petroleum industry, where some individuals purchase diesel, misclassify it as fuel oil, and fraudulently claim tax exemptions intended for industrial users.
“Some individuals are taking advantage and smuggling, buying diesel and disguising it as fuel oil and collecting the taxes on it,” Dr Forson told Parliament.
According to the Finance Minister, the exploitation has cost the country an estimated $25 million in revenue losses between January and June 2026 alone. He warned that without closing the loophole, the country stood to lose about GH¢1 billion annually.
Under the new arrangement, companies that use fuel oil for industrial purposes will pay the applicable levies upfront at the point of importation and subsequently apply for refunds. Dr Forson noted that the Revenue Administration Act would also be amended to reduce the refund processing time from 90 days to 14 days.
“For emphasis, there will not be a tax increase on petroleum products. What we are saying is that we are equally going to amend the Revenue Administration Act to make the tax refund system relating to industries buying fuel oil move from 90 days to 14 days,” he added.
The bill, introduced under the certificate of urgency, was referred to the Finance Committee, with the leadership of the Committee on Energy for consideration, before being passed on Friday. The government believes the amendment will safeguard public revenue, improve the integrity of the downstream petroleum sector, and ensure that fuel subsidies benefit only legitimate industrial users.
Ghanamps.com