Thursday, July 21, 2016

PPRA considers introducing tax on petrol, diesel, kerosene and gas

Petroleum Products Pricing Regulatory Agency (PPPRA) says that taxation of petroleum products like fuel, diesel, kerosene and gas holds a huge revenue potential for Nigeria.

This is contained in a report of the two-day National Revenue Retreat in Kano. According to the Report, PPPRA says the introduction of taxes on petroleum products will supplement the revenue lost due to the fall of oil prices at the international market.



It said the revenue potential from taxation of petroleum products was enormous, given the average national daily consumption of the products. The report showed that the average national daily consumption of fuel was 45 million barrel, diesel 9 million barrel and aviation fuel, 1.5 million barrel.

It also revealed that there were 3 different taxes that could be charged which the PPRA’s pricing template did not currently accommodate. These are Highway Maintenance, Government Tax, Import Tax and Fuel Tax.

“Fall in government’s revenue from oil sale receipts and budget deficits in the face of compelling demand has made it imperative that the nation begins to examine the next step in the petroleum downstream business in Nigeria.

Deregulation remains the key to achieving a self-sustaining downstream sector as well as the stimulation of the economic growth and social wellbeing of the populace. Environmental tax, consumption tax, fuel tax, VAT, Import and Excise tax, when included in the final pricing of petroleum products provides opportunities for petroleum products to provide direct funds for other sectors,” it said.

Also, PPPRA made available to the FG, the option of privatisation of refineries as another way for revenue generation. It also suggested that the Downstream Logistics Facilities should also be privatised.

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