The Trades Union Congress (TUC) has told the Minister of Finance Ken Ofori-Atta to withdraw the directive announcing the introduction of the Value Added Tax (VAT) on electricity.
Secretary-General of TUC, Dr Anthony Yaw Baah said that the VAT on electricity will compound the economic hardships workers and pensioners are saddled with presently.
To that end, they have given the government up to January 31st to withdraw the directive
“It is always the poor, including pensioners who bear the brunt and we should not allow that to continue. Today organized labour, our message to the government is that we cannot pay VAT on electricity, we will not pay it today, we will not pay it tomorrow.
“Organized labour is therefore demanding the directive from the Minister of Finance to stop the VAT on the consumption of electricity. So, we are giving the government up to 31st January 2024 to withdraw the letter. If by that time the directive has not been given to withdraw it, we will advise ourselves,” Dr Yaw Baah said at a press conference in Accra on Tuesday, January 23.
The Ministry of Finance announced that the implementation of the 15% VAT for residential customers of electricity above the maximum consumption level specified for block charges for lifeline units in line with Section 35 and 37 and the First Schedule (9) of Value Added Tax (VAT) Act, 2013 (ACT 870) has commenced.
For the avoidance of doubt, a statement issued by the Ministry said, VAT is still exempt for “a supply to a dwelling of electricity up to a maximum consumption level specified for block charges for lifeline units” in line with Section 35 and 37 and the First Schedule (9) of Act 870.
“The Electricity Company of Ghana (ECG) and the Northern Electricity Distribution Company (NEDCO) are, hereby, requested to liaise with the Ghana Revenue Authority (GRA) to ensure that the implementation of VAT for residential customers of electricity above the maximum consumption level specified for block charges for lifeline units takes effect on 1 January 2024, in line with Sectio35 and 37 and the First Schedule (9) of Act 870,” it said.
“By a copy of this letter GRA is requested to ensure that it liaises with ECG and NEDCO for the transfer of the revenues collected from the implementation of VAT on the subject matter as part of its domestic VAT collections,” it added.
