Parliament passes Energy Sector Levies (Amendment) Bill: Will it affect fuel prices? Explained

• Parliament has passed the Energy Sector Levies (Amendment) Bill, 2026 to close a tax loophole that allegedly allowed some traders to evade higher fuel taxes, costing Ghana an estimated US$25 million in six months.

• The new law raises the fuel oil levy from GH¢0.24 to GH¢1.93 per litre and extends the Road Fund Levy to fuel oil, with importers required to pay the levy upfront before claiming eligible refunds.

• Government insists the amendment is aimed at stopping tax fraud, not increasing fuel prices, saying motorists should not expect an immediate rise in petrol or diesel prices because of the new law.

Parliament has passed a new amendment to Ghana's fuel tax law aimed at stopping tax fraud in the petroleum sector, after the government said it lost about US$25 million through a loophole involving fuel oil imports.

The government insists the measure is not a new tax on motorists and says drivers should not expect higher fuel prices at the pump because of the law.

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Here's what the new law means and why it was introduced.

Parliament has passed the Energy Sector Levies (Amendment) Bill, 2026, which changes how fuel oil is taxed in the country.

The new law raises the Fuel Oil Levy from GH¢0.24 to GH¢1.93 per litre and extends the Road Fund Levy to fuel oil. It requires importers to pay the levy when the product enters Ghana before claiming refunds if they qualify. The amendment forms part of the government's efforts to improve tax collection and reduce revenue losses in the downstream petroleum sector.

According to Finance Minister Dr Cassiel Ato Forson, some traders allegedly exploited a weakness in the tax system by importing diesel but declaring it as fuel oil, which attracts lower taxes. Because diesel carries higher taxes than fuel oil, the government said this practice enabled some companies to avoid paying the correct amount of tax. Diesel attracts taxes of GH¢3.35 per litre whereas fuel oil attracts tax of GH¢ 0.25 per litre.

Making his remarks in Parliament, he estimated Ghana lost about US$25 million in tax revenue over the past 6 months because of this loophole. The government believes increasing the levy on fuel oil and collecting it upfront at the point of importation will make such tax evasion much more difficult.

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Fuel oil is not the same as the diesel or petrol most motorists buy at filling stations.It is a heavier petroleum product mainly used by factories, Industrial boilers, ships and some power plants. Because it serves different industrial purposes, it has been taxed differently from diesel.

The government says no. Finance Minister Dr Ato Forson has stressed that the amendment is designed to prevent tax fraud, not to increase the price motorists pay for fuel. Under the new system, companies importing fuel oil will pay the levy first. Businesses that genuinely qualify for exemptions or subsidies can later apply for refunds after verification.

This approach is intended to ensure taxes are paid correctly while preventing abuse of the system. However, fuel prices are influenced by several factors, including global crude oil prices, the cedi's exchange rate, refinery costs and distribution margins. This means pump prices can still change for reasons unrelated to the new law.

Every cedi lost through tax evasion reduces money available for public services such as roads, healthcare and education. By closing the loophole, it expects to:

• Recover lost tax revenue.

• Improve transparency in fuel imports.

• Ensure companies pay the correct taxes.

• Protect government revenue without introducing new taxes on consumers.

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The measure also supports broader efforts to strengthen Ghana's energy sector finances and improve tax administration.

For most drivers and households, nothing changes immediately. If the government's assurances hold, motorists should not see an increase in petrol or diesel prices simply because Parliament passed this law.

Instead, the change is for petroleum importers, who will now have to pay the higher levy on fuel oil upfront and claim refunds only if they are entitled to them.