Why Are We Still Paying the TOR Debt Levy While the Debt Keeps Rising?
If you’ve bought fuel in Ghana anytime over the past 20 years, you’ve unknowingly helped pay off the debts of the Tema Oil Refinery (TOR). At least, that was the plan.
In 2003, the government introduced the TOR Debt Recovery Levy, a seemingly straightforward solution to a complex problem. A surcharge of about 8 pesewas per litre was added to the price of every litre of petrol and diesel sold at the pump. The idea was to use these funds to pay down the refinery’s ballooning debt, caused by years of under-recoveries, poor management, and inefficiencies in pricing.
A Levy with a Promise
Ghanaians were told that the TOR levy would support the refinery’s financial recovery and put it back on stable footing. For a while, it seemed to be working. By 2015, the levy had raised nearly GH₵1.9 billion. But instead of reducing TOR’s debt, the numbers tell a different story. As of the end of 2024, TOR’s liabilities had ballooned to over US$517 million.
The natural question arises: after all these years and all those deductions, why is the debt not only still there, but growing?
The Levy that Disappeared into the Shadows
Part of the answer lies in how the levy has evolved. Initially ring-fenced for TOR, it was later consolidated into a broader revenue framework under the Energy Sector Levies Act (ESLA). In theory, this streamlining was meant to better manage Ghana’s energy sector debts. In practice, it has blurred accountability.
Tracking exactly how much of the current fuel levies go to TOR has become almost impossible for the average citizen. Annual reports to Parliament, required by law, are either delayed or omitted entirely, according to groups like the Africa Centre for Energy Policy (ACEP), which have repeatedly raised concerns about transparency and misuse.
The levy, meanwhile, remains firmly embedded in the cost of fuel, with little to show for it.
A Debt That Outlived Its Purpose
Twenty years on, TOR is still in the red. It is still borrowing. And it is still reliant on public funds to stay afloat. The refinery’s financial position, far from improving, has worsened, raising fundamental questions about the purpose and performance of the levy.
According to available data:
- TOR’s current debt stands at US$517 million (as of 2024).
- The TOR levy remains active and embedded in fuel prices.
- Accountability for the funds remains murky at best.
It’s a harsh reality for consumers who’ve paid the levy for decades, believing it was helping to resolve a national debt burden. If this were a standard loan, it would have been paid off several times over.
Time for a Rethink
As fuel prices rise and household budgets tighten, calls are growing louder for a reassessment of the TOR levy’s place in Ghana’s fiscal framework. If the original goal was to clear TOR’s debts and stabilise its operations, then the current results suggest a course correction is overdue.
Analysts and civil society groups have proposed three urgent steps:
- Full accountability and disclosure: Ghanaians deserve a breakdown of how much has been collected under the TOR levy over the years, and how much has actually gone toward debt repayment.
- Operational reforms at TOR: Fixing the refinery itself must become a priority. Governance inefficiencies, poor commercial models, and operational leakages need to be addressed if the refinery is to play any meaningful role in Ghana’s energy mix.
- A clear sunset clause for the levy: No tax should last forever without measurable progress. Citizens need clarity on when the levy will end, or at the very least, how its success is being evaluated.
A Nation Still Waiting
The TOR Debt Recovery Levy began with good intentions. But intentions alone don’t retire debt. After two decades of payments, what Ghanaians have instead is a legacy of opacity and a debt stockpile that refuses to shrink.
What started as a rescue plan has become a permanent feature in fuel pricing, and a cautionary tale about policy drift. Until government agencies provide clarity, accountability, and reform, Ghanaians may continue paying for a debt that seems to have no end.
Source: thehighstreetjournal.com
