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Ghana’s government halts controversial electricity tax after public outcry
Ghana's government has halted the implementation of a planned 15 percent Value Added Tax (VAT) on the domestic consumption of electricity.
The tax which is targeted at residential customers has since been protested by many labour unions and Ghanaians.
Following this, the Finance Ministry directed the state institutions responsible for the supply of power to suspend any such deductions pending further discussions with stakeholders.
In a press release issued on February 7, the Ministry instructed the Electricity Company of Ghana Ltd. (ECG) and the Northern Electricity Distribution Company (NEDCO) to hold on to a previous order for the implementation of the said tax.
The Ministry further indicated that arrangements are underway to meet with Organised Labour for a resolution to the development.
“On behalf of the Government, MoF would like to inform ECG and NEDCO to suspend the implementation of the VAT directive pending further engagements with key stakeholders including Organised Labour.
“The Ministry expects that these engagements will birth innovative robust and inclusive approaches to bridging the existing fiscal gap while bolstering economic resilience,” the statement further added.
Earlier, labour unions opposed the new tax and announced nationwide protests against it on February 13.
These labour unions insist on their planned nationwide demonstrations against the implementation of the policy if the tax is not totally withdrawn.
