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Alba Iulia
Monday, January 30, 2023

Government urged to consider reducing further value-added tax on petrol and diesel

EconomyGovernment urged to consider reducing further value-added tax on petrol and...

Copperbelt-based Good governance activist Peter Mulenga has called on the Government to consider reducing further value-added tax on petrol and diesel as way of cushioning prices of fuel.

The PF Government suspended value-added tax (VAT) on diesel and petrol in an effort to avert an expected price increase early last year.

Then Finance minister Bwalya Ng’andu signed a statutory instrument zero-rating petrol and diesel with effect from 1 January 2021.

The PF government had previously charged VAT of 16% on petroleum products.

Commenting on fuel pricing, Mr. Mulenga has observed that the continued increase in fuel prices seen in the last six months has remained a huge burden to many Zambians.

The activist said he was aware that the issue of high prices has not only affected Zambia but other nations globally.

“Please Reduce VAT on Fuel in the best interest of People’s Welfare.As fuel pump prices continue to rise across the globe, I am calling on the Government to consider reducing value-added tax (VAT) on petrol and diesel in the best interest of the Zambian people.I strongly feel that reducing value-added tax (VAT) on petrol and diesel will help to stabilize the cost of fuel pump prices in the country,” Mr. Mulenga said.

“In order to reduce the burden of rising petrol and diesel prices, the central government should reduce (further) cut fuel duty, the tax on each litre of diesel and petrol bought in Zambia.This development will equally increase the spirit of cooperative federalism.This is not criticism but a humble request to the Government through the Energy Regulation Board (ERB) to consider millions of Zambians affected by the rising fuel prices,” he said.

Mr. Mulenga said more efforts are needed from the government to ensure that fuel prices are stable in the country.

“Considering the cut for two years might ease the pressure families are facing as increased fuel prices has been pushing the cost of living up.I know that high fuel prices are not only rising in Zambia but the entire globe with the conflict between Russia and Ukraine compounding the situation. This situation has pushed pump prices up to unprecedented levels.Fuel remains the engine of the local economy as it borders on all spheres of business,” Mr. Mulenga said.

Meanwhile, Finance Minister Dr. Situmbeko Musokotwane in January 2022 extended the suspension of customs and excise duty on petroleum products.

In Statutory Instrument No.2 of 2022, dated 11th January 2022, the excise duty on petroleum and diesel remains suspended until 30th June 2022.

To prevent fuel increase, the previous PF government suspended the collection of these taxes(customs duty, excise duty, and VAT) by the Zambia Revenue Authority.

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