Residents in Kwara State have lamented the continuous price of cooking gas with a 12.5 kilogramme cylinder selling for over N6,000.
Some dealers who also spoke about this, blamed the hike in the product across the country to the reintroduction of the import tax otherwise called the Value Added Tax (VAT).
The dealers urged the Federal Government to halt the tax as the current hike in the commodity has brought untold hardship on them. Removing the VAT, they noted, remains the only measure that could bring down the retail price of the commodity in the country for now.
Segun Agbaje, a banker said, “We know that over 60 per cent of cooking gas in the country is imported. The importers will add Value Added Tax (VAT) to the cost of importation and other expenses.
“Sometimes last year when there was no VAT, 6kg cost between N1,800 and N2,000 to refill at the retail gas plant, while 12.5kg cost between N3,500 and N3,800.
“But today because of VAT, 6kg is refilled between N3,200 and N3,400, while 12.5kg costs between N6,250 and N6,350,” Agbaje said.
He added that this import tax was removed some years ago but the federal government decided to bring it back two months ago.
Yusuf Saka, a gas dealer said the hike had caused a serious drop in sales “because only a few people can afford the current price.
“Before the hike, I knew how much I usually make daily but since the new price took effect, my daily sales have dropped significantly.
“Government should consider withdrawing the tax so that the price will return to what it was before. Government should wait until domestic supply by Nigerian Liquified Natural Gas hits 90 per cent before reintroducing the import tax, meant to discourage the importation of the commodity,” he said.
Jumoke Olayemi, a trader at Mandate market expressed sadness that the price of the commodity had gone beyond the reach of many Kwarans.
Olayemi absolved dealers of blame in the price hike, saying that the commodity’s selling price was usually determined by the cost price.
“Importers are businessmen and not charity organisations. They will add the cost of importation, tax paid and their profit margin to arrive at the retail price.
“Government’s emphasis now should not be to impose tax on imported items but to increase the domestic production of cooking gas to meet local demand.
“As a mother, I preferred to use gas because it does not stain pots. Government should consider the pain Nigerians are going through and remove the tax to make the commodity affordable,” she urged.
Meanwhile the Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Mallam Mele Kyari says the challenges in sourcing adequate supply of LNG gas has led to the increase in the commodity.
Kyari during a working visit to the headquarters of the Department of Petroleum Resources yesterday in Abuja to strengthen its bond with the regulatory arm of the oil industry noted that
“Today, this country is under supplied with gas. I can tell you that we are having difficulty feeding our network across the country with gas, every day, it is a trouble to deliver gas. Once your supply is weak, it will affect pricing.”
“The supply mechanism of our LPG is very weak, that is why we are collaborating extensively to make sure that we are able to extract LPG from our gas resources so that it is made available to the market. Once supply becomes high, the price will definitely be impacted.”
He, however, added that the corporation is working with other sister agencies to make sure that more gas is available into the domestic market thus, making it close to homes.
He stated that its strategy to expand its network of availability would subsequently lead to gas directly delivered to homes of end users.
“If we do this, all cylinders will not be of any use. That is why I don’t see them used in many developed countries.”
The Director/CEO of DPR, Engr Sarki Auwalu, noted that the increase in availability in gas would engender job employment and help the country to have energy security.
He vowed to maintain the cordial relationship among the two agencies which would enable the oil sector to grow.
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