All is set for implementation of GHC1 fuel levy TODAY

The Ministry of Energy has confirmed that the long-anticipated GHC1 Energy Sector Levy will officially take effect on today Wednesday, July 16, 2025, after a brief postponement prompted by stakeholder concerns and global oil price volatility.

Richmond Rockson (Esq.), Head of Communications at the Ministry, explained on TV3’s Business Focus on July 14 that the delay stemmed from concerns raised by several Oil Marketing Companies (OMCs), including COMAC, which necessitated further consultations and government intervention.

In addition, Rockson noted that Iran-Israel tensions, which contributed to sharp increases in global oil prices, played a role in the postponement.

“The government decided to temporarily hold off on implementation to properly address the concerns raised by stakeholders,” he said. “Now that those concerns have been resolved, the levy is scheduled to come into effect on July 16.”

He stressed that the Energy Sector Levy is not merely a fiscal tool, but a strategic measure aimed at ensuring the long-term viability of the country’s energy infrastructure. “This is not just about money. The people of Ghana remain at the center of this decision,” Rockson added.

The levy forms part of a broader set of reforms intended to stabilize and strengthen Ghana’s energy sector, ensuring sustainable service delivery and infrastructure development over the coming years.

Mr Rockson announced that Marine Gas Oil (MGO) will fall under the scope of the Energy Sector Levy. This move aims to close existing loopholes and ensure uniform application of the levy across the sector.

The Head of Communications emphasized that the government is taking deliberate steps to ensure that no subsector is exempt from the levy.

“The MGO segment will not be exempt. It will be fully covered under the Energy Sector Levy,” Rockson stated.

The inclusion of MGO comes amid calls by the Chamber of Oil Marketing Companies (COMAC) for the government to scrap the subsidy on the product. The Chamber argues that removing the subsidy could save the country millions of cedis, as some unscrupulous players in the industry are allegedly diverting subsidized MGO for private resale at retail outlets.

The subsidy was originally introduced to reduce fuel costs for the local maritime sector, including fishing trawlers and maritime security operations. However, the Ministry believes that integrating MGO into the levy framework will promote transparency, accountability, and equity in the energy sector.

The Energy Sector Levy, once implemented, is expected to broaden the government’s revenue base and streamline regulatory oversight across all petroleum product categories.