CAMA calls for removal of fuel levies

By Bester Kayaye

The Consumers Association of Malawi (CAMA) has called on the government to remove some fuel levies in light of the impending sharp rise in fuel prices.

The call comes after the Malawi Energy Regulatory Authority (MERA) hinted on an expected drastic increase in fuel prices in the country following a sharp increase on landed costs for petrol, diesel and paraffin, by 16.16 percent, 24.67 percent and 24.71 percent respectively.

CAMA Executive Director John Kapito said there is a need for the government to remove levies on the price buildup such as ROAD, MAREP and MBS CESS in order to minimize knock-on effects brought about by the fuel hike.

Kapito said; “Prices of fuel in Malawi have been going up since December last year and MERA decided to hold increases for reasons better known by themselves despite the law or regulations demanding MERA to adjust prices of fuel once they are above or below five percent threshold.”

“The implications of such poor judgments are retrogressive to both the economy and the Consumer.”

He said that by holding prices of fuel, Government and MERA should understand that they are worsening the situation because these prices that are being held will still be passed on to Consumers.

Kapito explained that the failure to adjust pump prices of fuel has resulted in the depletion of the Price Stabilization Fund (PSF) resulting in huge losses by the oil marketers, as now landed costs of both diesel and petrol have gone up by an average of 25% which is too huge to be effected on pump prices at once.

He said: “This will be one of the biggest increases that will hurt consumers who are already experiencing serious economic challenges and high cost of living.”

“These three levies once removed they can assist to have reduced fuel pump price and minimize the impact of the new fuel prices.”