Prime News Ghana

Minority calls on gov't to immediately withdraw 18% tax on electricity

By Mutala Yakubu

The Minority is calling on the government to withdraw the 18 percent tax on electricity.

The minority says if care is not taken this new directive could have a negative effect on Ghanaians.

The Ghana Revenue Authority has tasked the ECG to charge Value Added Tax, (VAT) on domestic consumers and the minority is not in support.

The concerns were raised by the minority spokesperson on Mines and Energy, Adam Mutawakilu who accused the president of giving 50 perfect rebates to consumers with one hand and taking it back with another.

“That means that you will pay more for electricity, it will deny you from the food that you buy because you have to do your scale of preference and consumers will be burdened the more…so this 50 per cent was just to deceive Ghanaians, so you gave it to Ghanaians with one hand and then you take it with another hand.”

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The decision to impose VAT on electricity for consumers comes a month after the President reduced electricity consumption by 50 per cent to commercial and domestic consumers and free for lifeline consumers.

The President has announced three months of free electricity for consumers of a particular category, to make up for lost income following the coronavirus lockdown in Accra and Kumasi.

Addressing the nation in a televised broadcast Akufo-Addo said the decision is part of additional measures being taken by government to mitigate the impact the outbreak of the virus is having on the public.

“We’ve decided on further measures of mitigation for all Ghanaians for the next three months, i.e April, May and June. Government will fully absorb electricity bills for the poorest of the poor, i.e, for all consumers. That is free electricity for persons who consume from 0-50 kilowatt-hours a month for this period,” the President told the nation.

In addition, the President said the government will also absorb 50% of electricity bills for consumers in residential areas as well as those engaged in commercial activities during the period using their March 2020 bill as the benchmark.

Until now, electricity for consumers has been zero-rated for VAT since 2001.