Ghana Eyes GH¢400 Million Monthly Windfall from ESLA Hike—Without Raising Fuel Prices

ACCRA— Ghana’s Finance Ministry is poised to execute a bold fiscal maneuver that could rake in an estimated GH¢400 million every month—without triggering an uptick at the fuel pump.

According to sources close to the policy discussions, the government is set to increase the Energy Sector Levies Act (ESLA) charge from 20 pesewas to GH¢1.00 per litre on petrol and diesel, leveraging falling international oil prices and a strengthening cedi. The revised levy is expected to take effect in the upcoming fuel pricing window on June 16, pending swift Parliamentary approval under a certificate of urgency.

Ghana consumes roughly 470 million litres of fuel monthly. At an 80 pesewa hike per litre, the state could net upwards of GH¢4.4 billion annually—a rare fiscal opportunity in an election-cycle economy saddled with $3.1 billion in legacy energy sector debt.

A Tax in Disguise—or Smart Policy?

While the move appears aggressive, analysts say the government is walking a tightrope—introducing new taxes under the cover of falling market prices, without hurting consumers.

“This is strategic,” said one industry insider. “It’s not often you get a window where taxes can rise without the public feeling it at the pump.”

Indeed, market indicators suggest that fuel prices are expected to decline in the coming window, giving the Finance Ministry headroom to implement the increase with minimal public backlash—at least in the short term.

A Debt-Hungry Sector and a Familiar Playbook

Ghana’s energy sector is buckling under a mountain of arrears. Years of under-recoveries, bloated procurement contracts, and delayed payments to Independent Power Producers (IPPs) have culminated in a debt pile that continues to sap fiscal space and investor confidence.

The ESLA, introduced by the Mahama-led NDC government in 2015 to retire these liabilities, has since become a political football. Critics accuse successive governments—particularly the current NPP administration—of diverting proceeds for unrelated expenditures, exacerbating the very debt the levy was meant to resolve.

Now, the government argues it is merely revisiting a proven policy—using favorable market conditions to plug chronic structural gaps.

“This is not new,” one economist told Accra Street Journal. “Both NDC and NPP have used soft markets to introduce or raise fuel levies. The real question now is whether the funds will be ring-fenced and transparently managed.”

Demanding Accountability: Transparency or Trouble

The public reaction will likely hinge not on the tax itself, but on how the revenue is used.

Industry stakeholders are already pressing the Finance Ministry to publish monthly reports detailing collections, disbursements, and outstanding balances related to ESLA. They argue that transparency is the only way to win—and keep—public trust.

Some are calling on Finance Minister Dr. Cassiel Ato Forson to personally spearhead this effort, positioning fiscal discipline and transparency as the backbone of his tenure. Anything less, they say, risks reigniting the familiar perception of fiscal sleight-of-hand and partisan mismanagement.

The Editorial Take: A Clever Tax—Now Prove It’s Worth It

On paper, the ESLA hike is a masterstroke of timing—deploying tax policy with surgical precision amid disinflationary tailwinds and a strengthening currency. But the political risk is real.

If pump prices creep up anyway—or if ESLA funds vanish into opaque accounts—the backlash will be swift and unforgiving.

Ghana’s taxpayers have seen this play before. What they haven’t seen—at least not consistently—is evidence that these taxes solve the problems they claim to address.

For the Finance Ministry, this is more than a revenue measure. It’s a litmus test of credibility, execution, and political maturity. If handled right, it could stabilize the energy sector and free up billions for essential services. If not, it will simply add to the list of taxes that raised revenue—but not results.

Last Updated on June 10, 2025 by emryswalker