Energy and Water Utilities Regulatory Authority (Ewura)
Energy and Water Utilities Regulatory Authority (Ewura) has
released data this week unveiling the scheme under which the government
takes out 60 per cent tax disguised payments out of one litre of fuel
sold at a filling station.
The discovery comes at a time when the public is awash with an
outcry over the government’s failure to lower fuel pump prices even as
the oil prices in the world market plunge into extreme depths.
Global oil prices have radically tilted to as low as Sh54, 815
($25.11) a barrel this year from a record high of Sh218, 300 ($100) in
2014, according to issued recently by the regulatory authority.
While the world oil prices have been for a long time fluctuating
between its historical lowest levels, consumer market prices in Tanzania
have been stagnant throughout, with motorists paying Sh1,890 for a
litre of petrol, out of which they simultaneously pay the state about
Sh1,000, leaving only about Sh900 to operators of the filling stations.
According to Ewura, the 60 per cent controversial contribution to
the state is worth a cluster of more than a dozen taxes embedded in one
flacon.
They include Sh908.15 for Insurance and Freight (CIF), wharfage
$10/MT +18 per cent Value Added Tax (VAT) equivalent to Sh19.28, railway
development levy Sh22.56, customs processing fee Sh4.80, weight and
measures fee Sh1.000 and Sh1.24 for Tanzania Bureau of Standards (TBS)
charges.
Other include tipper fee for Sh0.20, actual demurrage costs Sh2.26,
surveyors costs Sh0.15, financing costs Sh9.08 and regulatory levy
worth Sh6.10. The list of costs incurred by a consumer at pump station
also includes evaporation losses levy charges for Sh4.54, petroleum
marking costs of Sh12.48, Fuel levy worth Sh313, excise duty of Sh339
and petroleum fee worth Sh100.
While petrol costs levy slapped on a litre of petrol stands at
Sh752, and when other costs are added to it, amounts to Sh1, 997 per
litre as a petrol pump prices, diesel CIF price attract around Sh879.35
and government taxes Sh628.
When combined with other costs as reflected in the petrol pump
prices, the consumer price for a litre of diesel amounts to Sh1,823.
A recent report availed to The Guardian on Sunday revealed that the
Organization of the Petroleum Exporting Countries OPEC countries daily
gasoline basket price stood at $25.11 a barrel as of January this month.
Such countries include Algeria, Angola, Ecuador, Iran, Iraq,
Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, United Arab Emirates and
Venezuela, among whose list are major exporters to Tanzania.
According to the Tanzania Roads Fund Board (RFB) at least 97 per
cent of all the revenues accrued for roads construction and maintaining
in the country originate from fuel products.
In a statement availed to the media this week, Ewura Director
General Felix Ngamlagosi said the fuel price at the world market is a
major determinant of the pump prices in the country.
However, he said there are charges associated with fuel importation
in the country such as wharfage, railway development levy, customs
processing fee, weight and measures fee, and Tanzania Bureau of
Standards (TBS) among others which amounts to the rising of fuel pump
prices.
He said Ewura has regulated the price of fuel pump from Sh2,200 a litre in 2008 to Sh1,140 in 2009.
According to him, refining imported crude oil in order to get
refined petrol is an expensive exercise that also adds to the cost of
the pump price.
“The price of pump price in the local market depends much on fuel
import costs of on ships with fuel which have been received in the same
months but were bought the previous months” he said
He also pointed out that the authority uses a special formula to
set pump price in the local market by involving all stakeholders in the
sector before the prices are made public through the government
newspaper.
The director said the ongoing fuel fall at the world market between
2014 to-date will gradually lead to the fall of price in the local
market.
He said it is important for the public to understand that the
refined fuel price fall at the world market contributes between 46 and
49 per cent of the fuel prices in the local market but it does not have
connection with pump price.
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