Ghana Imposes New Levies on the Energy Sector
Parliament recently passed the Energy Sector Levies Amendment Act, 2021 (Act 1064) to amend the Energy Sector Levies Act, 2015 (Act 899). The new amendment imposes an Energy Sector Recovery Levy of 20 pesewas per litre on Petrol and Diesel and 18 pesewas per kilogram on Liquified Petroleum Gas, and a Sanitation and Pollution Levy of 10 pesewas per litre on Petrol and Diesel.
Specifically, revenue from the Energy Sector Recovery Levy will be used to help pay the capacity charges in the energy sector and its bills, which includes the fuel used by power plants to generate energy.
Similarly, proceeds from the Sanitation and Pollution Levy will be used to improve the quality of air in urban areas; to design, construct, and re-engineer waste treatment and disposal facilities like recycling facilities, landfill sites and medical waste treatment facilities; to construct sanitation facilities; to support disinfestation, disinfection and fumigation of public spaces, schools, health centres, markets, and lorry parks; and to provide dedicated support for the maintenance and management of major landfill sites and other waste treatment plants and facilities across the country.
It is estimated that the total receipts from the levies in 2021 would be GH¢666.2 million and GH¢311.7 million for the Energy Sector Recovery Levy and the Sanitation and Pollution Levy, respectively.