The Nigerian Association of Liquefied Petroleum Gas Marketers (NALPGAM) today called on the Federal Government to remove the Value Added Tax (VAT) on locally produced Liquefied Petroleum Gas (LPG), cooking gas.
The President of the association Mr. Nosa Ogieva-Okunbor, made the appeal at an interactive session with journalists in Lagos over the rising prices of cooking gas in the market.
The petroleum product downstream top shot explained that it had become imperative for government to adopt effective policies in the LPG’s sub-segment of the market as a strategic step towards attracting investments into the LPG sector, deepening market penetration, boosting the country’s economy and protecting the environment.
According to him, one of the fiscal policy measures that can immediately be adopted to attract more investors and reduce importation of gas into the country, which is VAT free, .is the removal of VAT on the gas supplied to marketers by the Nigerian Liquefied Natural Gas (NLNG).
Ogieva-Okunbor also canvassed the reduction of import duty on LPG equipment in a bid to attract more investors into the sub-sector and make cooking gas more affordable to end users.
He clarified: “Our position is that the government has to provide the enabling environment for more people to come in. We have to remove VAT on the LPG and reduce import duties on the equipment. When this is done, more investors will come into the market and that will help the country a great deal.”
Reflecting on the price trend in the market, Ogieva-Okunbor, who urged the Federal Government to sanction marketers that may be found to be arbitrarily increasing prices,
Disclosed that the price of 20 metric tonnes (about 35,000 litres) of the LPG, which was selling at N4 million a few weeks ago had risen to N4.6 million now.
He attributed the lingering price instability in the domestic LPG market to the activities of a cabal behind the delayed berthing of the LPG bearing vessels at the terminals.
The NALPGAM leader said: “We have been contending with the issue of price instability because a couple of people have hijacked the government’s good gesture of installing the domestic scheme. Under the scheme, gas will be readily available in the major terminals in Lagos. When there are no supply shortages, there will be a level playing ground in terms of competition and pricing.
“The Pipelines and Product Marketing Company, a subsidiary of the Nigerian National Petroleum Corporation, is tasked with the responsibility of managing the berthing of the LPG vessels at the terminals
“But some the cabal is causing a near monopoly in the LPG market as only a private terminal is able to receive imported gas product, while NLNG gas cannot find a place to berth,” Ogieva-Okunbor lamented.
While noting that government’s effort to make cooking gas available to households were being undermined by some unscrupulous saboteurs, the industry leader appealed to government to dredge the Southern Escravos of Warri port to enable bigger vessels carrying gas berth at the port and lessen the congestion at the Lagos port.
In addition, he pointed out that the completion of the Escravos dredging would make the seaport commercially viable for gas marketers and other seaport operations.
Investigations in Lagos indicated that the price of 12.5 kg cylinder of cooking gas which used to sell at N3, 600 early this year had jumped to N4, 300 currently while other cylinder prices have also risen.
