Marketers demand suspension of VAT on diesel

Marketers demand suspension of VAT on diesel

Oil marketers have called on the Federal Government to suspend the Value Added Tax on diesel, as it would further increase the burden on Nigerians.

The Chairman of the Major Oil Marketers Association of Nigeria, and Chief Executive Officer of Ardova Energy, Olumide Adeosun, made the appeal during an interactive session with journalists in Lagos on Tuesday.

He suggested that temporarily exempting diesel from VAT would help alleviate the financial burden for the general population, especially amidst the petrol prices hike.

He emphasised the need for a sustainable welfare package for citizens.

Adeosun highlighted the importance of productivity in the country’s development and called on the government to address the issues of insecurity, productivity in the oil and gas sector, and the high cost of food and transportation.

He urged the government to introduce subsidies on transportation and power and tackle the challenge of crude oil theft.

According to him, MOMAN members have the capacity to import petrol into the country, as such they should be permitted to import petrol and take off the importation burden from the Nigerian National Petroleum Company Limited before local refineries commence production.

“The reality is that many of us have importation licenses that have never lapsed. We renew them on a quarterly basis via the NMDPRA portal. Some of us are also importing diesel, so we need these licenses.

“The licenses cover multiple products such as ATK, PMS, and AGO. The regulator will tell us that we need them even when we are receiving products from the Nigerian National Petroleum Company Limited, particularly on the high seas,” he said.

Adeosun also emphasised the need for efficiency in the importation and delivery operations process to offset the shortcomings in forex rates.

“That has often been the case when aligning with the NNPCL operating regime. Efficiency has always been at the forefront, and subsidies will absorb all of that. As for us, we own the vessel, depot, trucks, and retail outlets. So, we can afford to optimise efficiency,” Adeosun continued.

He called on the government to implement favourable regulatory frameworks, provide incentives for renewable energy projects, and encourage research and development in clean technologies. “This newfound commitment to alternative fuels is not only driven by environmental concerns but also by the economic and social benefits associated with a transition to a sustainable energy future. By embracing alternative fuels and renewables, governments are not only leading the way towards a greener and more resilient future but also fostering innovation, job creation, and energy security for our country,” he said.

Adeosun’s plea comes on the heels of the pronouncement by the Presidential Committee on Fiscal Policy and Tax that it was holding discussions with the Federal Government to suspend the 7.5 VAT on diesel given the effect of the rise on transportation and other costs.

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