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Gov’t discusses fuel marking initiative with oil companies

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By Omar Bah

The Ministry of Finance in partnership with the Gambia Revenue Authority yesterday held a sensitisation workshop for Gambian Oil Marketing Companies (OMC’s) on the imminent introduction of a fuel marking device designed to address smuggling of fuel into the country. Held at the Bakadaji Hotel, the discussions focused on the Directorate of Public Private Partnership on the Fuel Integrity System as part of a signed contract for the implementation of a revenue mobilisation solution for excisable goods, telecom services and refined fuels between the government of the Gambia and SICPA.

It was designed to shape and create awareness of all relevant stakeholders on the scopes of the project to create a common understanding on the implementation process of this component intended to provide solutions for the monitoring of imported refined fuel (gasoline, diesel, kerosene) into the Gambia.

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GRA Commissioner General Yankuba Darboe said the fuel marking device will ensure the fight against ilicit trade and counterfeiting. He said the project would be implemented in phases.

“Today, we are sensitising key stakeholders in the oil industry as we anticipate the implementation of this second phase which is the Fuel Integrity Solution (FIS),” he said.

CG Darboe said the stakeholders are sensitised on how the software for managing the marking operations of fuels will be operationalised.

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“The project is part of GRA’s wider reform initiatives under its current strategic Plan 2020-2024,” he added.

Mr Darboe said the GRA has set up a dedicated enforcement staff to carry out compliance monitoring of all products within the scope of the project.

“They will report incidences of non-compliance during the course of their compliance monitoring activity for the timely intervention of GRA Management. This will help reduce under declaration and increase tax collection by accounting for all the fuels imported into the country. It will also reduce smuggling by using field inspection equipment and devices to validate marked fuels in the market,” CG Darboe stated.

The Permanent Secretary Ministry of Finance, Abdoulie Jallow, said the digital tax stamp on excisable goods provides a verification mechanism that ensures all excisable goods consumed by the general public are free of counterfeit.

“For operators, the solution provides a platform to combat smuggling and dumping thus providing local manufacturers a level playing field and fair competition. It also allows manufacturers to closely follow their production volumes, know their market share,” he said.

On the part of the government, PS Jallow added, “It will ensure that hazardous products are eliminated from the market, thus reducing health spending for the government and also allow the government through GRA to fairly assess taxes based on actual production, thus improving the efficiency of the tax system.”

Mr Jallow said the purpose of the fuel marking is to combat smuggling related to petroleum products and accord players in the sector a fair competition and ensure quality.

“This will ensure that operators are guaranteed very transparent market conditions, free of smuggled products that naturally do not pay duties and taxes. Effectively, this guarantees the investments of OMCs and their shareholders from any unfair competition,” he said.

Jallow said the first component of the project which is digital tax stamp on excisable goods is already in full operation.

The deputy director general of regulators PURA, Solo Sima, said the Gambia is not alone in employing such initiatives, rather, the uptake can be seen across the sub region and beyond.

“For example, the East African Community (EAC) implemented a fuel marking program to combat fuel adulteration and smuggling. This led to a reduction in adulterated fuel from 30% to below 1% within five years. Additionally, tax revenues increased significantly due to reduced smuggling. Equally we can also draw reference to Nigeria: who introduced the scheme in 2017, to tackle widespread fuel smuggling and subsidy fraud. The program helped recover over $1 billion in lost revenues within the first two years of implementation,” he said.

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