Price of cooking gas rises by 20 per cent as marketers seek VAT removal
The price of Liquefied Petroleum Gas (LPG) otherwise known as cooking gas has continued to rise despite calls by marketers for the removal of Value Added Tax (VAT) on the commodity.
In a space of two weeks, the price of the product rose by 19.6 per cent nationwide. Findings by The Guardian revealed that a trailer-load of the commodity went up from N4.6 million to N5.5 million during the period under review.
Some consumers, who hitherto bought the 12.5kg cylinder size for N3,600, now pay close to N4,000 for the product in recent times. Though in certain quarters, there was a slight drop in price, as it returns to the NN3,400 – N3,600 threshold.
The Executive Secretary, Nigerian Association of Liquefied Petroleum Gas Marketers (NALPGAM), Bassey Essien, in a telephone interview, said the industry had experienced price fluctuations in the last 14 days.“From N4.6 million for a trailer-load (20 metric tonnes) of LPG, the price rose to as high as N5 million and N5.5 million in the last two weeks. It has also dropped to N5.150 million lately,” he stated.
The ES regretted that the resellers who bought the product when it went up could not sell at a loss, adding: “We may not see the price drop immediately.“Old consignments will still have a high price tag, but new consignments are likely going to record drop in prices.”
On the call for VAT removal on locally sourced commodity, Essien stated: “Imported gas is cheaper than the one we get from NLNG, and unfortunately, the tax is still being paid on it. This is the reason we are calling for its removal.
“If VAT is eventually removed from the commodity, it will create a level-playing field in the industry, and ensure that imported LPG does not strangulate the locally sourced ones,” he added.The president of NALPGAM, Nosa Ogieva-Okunbo, had said it was imperative for the Federal Government to develop effective policies to encourage investors to come into the sector to deepen market penetration as well as boost the country’s economy and protect the environment.
He commended the government for setting up a committee to look into the matter and related challenges, stating that VAT removal would attract more investors and reduce importation.The Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, recently set up the inter-ministerial panel to come up with lasting solutions to the problems facing the sub-sector.