Page 13 - DMEA Week 18 2020

DMEA FUELS DMEA
Rwandan fuel importers seek tax break for excess supplies
RWANDA
The Rwanda Association of Petroleum Products Importers (RWAPI) is reportedly pressing the government to help
its members transfer excess fuel supplies to privately owned storage depots.
THE Rwanda Association of Petroleum Prod- ucts Importers (RWAPI) is reportedly pressing the government to help its members transfer excess fuel supplies to privately owned storage depots.
Joseph Akumuntu, RWAPI’s executive secre- tary, told The New Times last week that many Rwandan importers had found themselves with more fuel than they could sell, after officials in Kigali introduced restrictions designed to curb the spread of the coronavirus (COVID-19) out- break. The excess volumes are now stranded in trucks parked by the roadside, the newspaper said.
“Importers ordered this fuel about two months before COVID-19 [hit],” Akumuntu explained. “By the time it got here, the lockdown had already been imposed. This means that the storage facilities are full because consumption levels have since dropped by 80%.”
The supply glut is a financial burden, as well a logistical challenge, he stated. Rwan- dan fuel importers are contractually obli- gated to pay demurrage fees of $100 per day to the owners of the tanker trucks they use whenever they fail to meet deadlines for loading or unloading their cargoes on sched- ule, he said.
RWAPI hopes the government will help its members by offering a tax concession, he said. Currently, he noted, importers have an incen- tive to transfer their fuel into the storage depots overseen by the Rwanda Revenue Authority in
Gatsata, Jabana, Kabuye and Rusororo. Compa- nies that do so are able to delay payment of taxes on their fuel until they collect volumes for local distribution, while companies that rely on pri- vate storage facilities must pay all taxes due upon offloading, he said.
As such, he said, RWAPI wants the govern- ment to permit the usage of private facilities on the same terms. “Some of us have facilities where we can offload this fuel, but we cannot afford to pay the full tax right away,” he told The New Times. “We are hoping to discuss with the Min- istry of Trade and come up with a solution that will cut [down] on the losses we are incurring right now.”
Trade Minister Soraya Hakuziyaremye indicated that Kigali was considering RWAPI’s proposal but stressed that no solution had been adopted yet. “It’s true that they have contacted us. We are dealing with people who have nowhere to offload this fuel and [are] considering giving them tax concessions so that they can take this fuel to their petrol stations, and then we can revisit this when activities actively reopen,” she said.
Rwanda typically consumes about 20mn litres per month of gasoline and the same amount of diesel. Gasoline consumption dropped to an estimated 5mn litres in April, though, while diesel consumption sank to 7mn litres. The New Times estimated the volume of excess motor fuel still waiting to be unloaded from tanker trucks at 6.6mn litres. ™
Week 18 07•May•2020 w w w . N E W S B A S E . c o m P13