Tanzania has suspended its fuel levy for the next three months to cushion consumers from cost increases as it anticipates a spike in global oil prices following the Russia-Ukraine war.
The Tsh100 tax on a litre of fuel, gasoline, or kerosene, which had been in place since July 2021, has been removed, according to the Ministry of Energy, as the government watches the worldwide market in the light of the eastern Europe war.
The suspension will remain in place until May 2022.
The Ministry said; “Despite the fact that this decision will cause the government to lose about Tsh30 billion in monthly revenue, it is seen as necessary to protect the citizenry against the impacts of global oil prices worldwide.
“If this decision had not been made, pump prices in Tanzania from March onwards would have become far too high for various reasons, including the war that is developing in Eastern Europe.’’
Energy Minister January Makamba, according to the statement, has previously signed the change to the statute establishing the fuel levy.
The price change will be reflected in the Energy and Water Utilities Regulatory Authority’s (Ewura) pump price review, which will be notified on March 2.
Petrol prices ranged from Tsh2,480 ($1.078) to Tsh2,712 ($1.18) per litre in February, and diesel prices ranged from Tsh2,338 ($1.016) to Tsh2,570 ($1.12) per litre, depending on distance from the coast.
The gasoline levy was enacted by the government through the new Finance Act of 2021, which took effect on July 1, 2018, the first day of the current fiscal year 2021/2022.