Parliament approves new GH¢1 fuel levy after minority walkout

Parliament has officially passed the Energy Sector Levy (Amendment) Bill, 2025, giving the green light for the government to introduce a new GH¢1 tax on every litre of petrol, diesel, and other fuel products. The approval came late on Tuesday, June 3, 2025, after a heated debate that ended with the Minority walking out in protest.

The bill, described by many as controversial and burdensome, was laid before the House by Finance Minister Dr. Cassiel Ato Forson under a certificate of urgency, signaling that government saw it as an emergency measure.

Dr. Forson explained that the new levy is not just another tax—it is a lifeline for the country’s troubled energy sector, which is currently sitting on a huge debt of US$3.1 billion as of March 2025.

The Real Situation: Power Sector in Big Trouble

According to the Finance Minister, Ghana needs a total of US$3.7 billion to completely clear the energy sector debt. On top of that, the country will need an additional US$1.2 billion to buy fuel needed to power our thermal plants for the rest of 2025.

These debts are owed to a number of key players in the energy sector:

Independent Power Producers (IPPs)

State-Owned Enterprises (SOEs) like GRIDCo, VRA, and ECG

Fuel suppliers, who have not been paid for fuel delivered over several months

Dr. Forson said the government cannot continue to pretend everything is fine. “If we do not act now, the power sector may collapse, and the lights will go off again,” he warned, referencing the dark days of “dumsor”, a word every Ghanaian remembers with pain.

“The Cedi Is Strong – Prices Won’t Go Up for Now”

To ease the fears of Ghanaians already struggling with high living costs, the Finance Minister promised that this new tax will not affect fuel prices—at least for now. He said that the recent strong performance of the Ghana Cedi has created a cushion for the country to absorb the new tax without increasing fuel prices at the pump.

“Mr. Speaker, our calculations show that even after applying the GH¢1 levy, there will be no increase in fuel prices in the next pricing window. The gains from the Cedi are enough to cover the cost,” Dr. Forson told Parliament.

He also gave assurance that the funds generated from this levy will be strictly used for fuel procurement and power generation. It will not be mixed with other government revenue or misused.

“This is not politics. This is a national emergency,” he added.

Minority Strongly Opposes – They Walk Out

But not everyone agreed. The Minority in Parliament, led by MPs from the opposition National Democratic Congress (NDC), rejected the bill outright. They described it as another unnecessary burden on Ghanaians, especially at a time when many families are struggling to afford food, transport, and school fees.

Tensions ran high as the Minority accused the Majority of trying to force the bill through without the required numbers in the House. They claimed the Majority could not constitutionally pass the bill without a proper quorum. When their protests were ignored, the Minority walked out of Parliament, leaving the Majority side to complete the vote alone.

Despite the walkout, the Majority went ahead and passed the bill, saying the country cannot afford to delay this important intervention.

Mahama Ayariga Makes a Case for the Levy

Before the final vote, Majority Leader Mahama Ayariga made a passionate appeal to his fellow MPs and the entire nation. He told Parliament that the GH¢1 levy is not like the E-Levy, which was recently scrapped by the government after months of public backlash.

“This is not like the E-Levy. This is about keeping the lights on in our homes, our hospitals, our businesses. This is about Ghana’s future,” Mr. Ayariga said.

He pleaded with Ghanaians to see the levy as a patriotic contribution.

“All we’re asking is for you to contribute one cedi, just one cedi per litre of fuel to help solve our power crisis. We all use electricity—let’s all help fix it,” he said.

Mr. Ayariga also reminded Ghanaians that a stable energy supply is the backbone of the economy, and without it, investors will run, jobs will be lost, and businesses will shut down.

GH¢5.7 Billion Expected from Levy

With the bill now passed into law, the government expects to raise about GH¢5.7 billion every year from this new GH¢1 fuel levy. This money, according to the Finance Ministry, will go directly into fuel purchases for power plants, paying off old energy debts, and keeping Ghana’s lights on.

The Energy Minister and the National Petroleum Authority (NPA) are expected to immediately implement the new levy, and revenue collection could begin within days.