CAMA demands temporary removal of fuel levies

Consumers Association of Malawi (CAMA) says the recent high increases of fuel have largely been triggered by poor judgment and lack of understanding as well as being blinded by poor leadership that has failed to analyze the negative economic impacts of the recent devaluation of the kwacha on poor Malawians that were already experiencing one of the worst high cost of living.
CAMA has since reiterated its stance it made in January that the government should review the many levies that are added on the fuel prices — that if removed could lead to reduction of pump price —  then at K950.00 per litre and diesel at K931.00 per litre.

The astronomic fuel hike effected this week are petrol up by 44.92% from K1,380 to K1,999 a litre; diesel by 30.61% at K1,920 from K1,470 and 29.29% for paraffin — at K1,236 from K956.

Executive Director John Kapito
In his statement issued today, June 25, Executive Director, John Kapito says CAMA is concerned that during this difficult time, President Lazarus Chakwera “approved the reintroduction of both old and new levies or taxes on prices of fuel”.
Yet, he said, “the President and his Ministers are given free fuel for doing absolutely nothing at the expense of the poor Consumers” thus asks the leadership “to temporarily remove all levies from the fuel price build up to cushion consumers”.
“CAMA is also asking the President to immediately come up with realistic austerity measures for himself and his friends in Cabinet — we can no longer through our taxes manage to pay high perks to a few selected friends of the President.
“We can no longer afford to pay for a large Cabinet of Ministers that add no value to Malawians and we can no longer afford to pay a large and bruited Civil Service through our taxes.”
Kapito first said CAMA has objectively supported increases of certain essential products such as water, electricity and petroleum products “where such increases benefited the long term interests of consumers”.
In saying that the “recent high increases of fuel have largely been triggered by poor judgment and lack of understanding”, Kapito said the Government “was aware that international oil prices were going up which would further create more challenges to consumers”.
“No Malawian understands why any sensible Government would think of devaluing its currency considering its impacts at a time when the global economy is becoming more unpredictable, the devaluation has demonstrated the weakness and incompetence of our leadership.
“The President and his team just revealed once again that they lack proper skills to lead a country, they lack full understanding of merits and demerits of devaluation to a country like Malawi which is a net importer a country with no export base.
“A country that would benefit nothing from devaluing its currency apart from pleasing IMF, unfortunately despite the crazy demands from IMF the country benefited nothing despite making Malawians poor.”
CAMA reminds Chakwera that this is the time Malawians are asking his leadership to deliver what he promised to improve their lives, saying the President “needs to understand that with the current economic challenges Malawians will never forget him as one and only President that came into power for his own personal gratification”.
“The President has failed to improve the poor economic conditions of Malawians and continues to refuse trimming his own personal benefits and those of his close friends in Cabinet.
“Despite the challenges facing all Malawians, he is still rewarding his close friends like Ministers and top senior government officers with their huge perks and demanding poor Malawians to tighten their belts.
“The President must be told the truth that he was voted into office by the very same poor Malawians he is hurting now and not IMF or his close friends.
“Mr. President, we are hurting now because of you and we are asking you to be a listening leader, Malawians will never forgive you for causing so much pain to innocent Malawians.
“Mr. President you cannot continue collecting taxes or levies from the poor in order to protect and enrich yourself and your close friends, time has come that we share the pain of your poor economic decisions and time has come for you to test your own medicine.
As a recap, CAMA proposed in January the removal of the levies that includes the Road Levy, which was introduced some years back to assist in the construction and rehabilitation of roads and at a time when systems and mechanisms were not established within relevant institutions.
Kapito had argued that now that the country has a full Road Regulatory Authority — “specific for road construction and rehabilitation — it is important to transfer such a tax to this appropriate authority bearing in mind that the Road Authority has just introduced the Toll Gate Tax whose purpose is similar to that of the Road Levy and it is unfair to punish Consumers with double taxation for the same type of service or product”.
He also said MAREP was intended to develop rural electricity connection infrastructure with hope to improve rural electricity access and argued that “this is a tax or levy whose accountability has been subjected to corruption and there is no significant impact on access to electricity for the rural masses”.
CAMA also targets the Malawi Bureau of Standards CESS, which is “another levy loaded on fuel prices and intended to provide quality assurance of our fuel” but CAMA contended that “it is common sense that the quality of Petroleum Products can only be inspected and assured before shipment and, therefore, the role of the Malawi Bureau of Standards to inspect and assure quality of fuel into the country is [redundant]”.
“For years, Consumers have been paying a tax to an institution that contributes nothing or plays no role in fuel quality assurance. It is unfair to punish Consumers to a levy that cannot be justified. The only thing this levy does is to distort market prices,” Kapito had said in January.

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