Government backs down after public outcry in regard to electricity VAT of 15%

In response to mounting pressure, the government has decided to delay the implementation of a 15 percent Value Added Tax (VAT) on electricity consumed locally

Earlier this month, the Ministry of Finance issued a press release instructing both the Electricity Company of Ghana and the Northern Electricity Distribution Company to cease levying the levy.

The statement read, “On behalf of the Government, MoF would like to inform ECG and NEDCO to suspend the implementation of the VAT directive pending further engagement 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.”

Following this development, Organised Labour, which had threatened nationwide protests against VAT implementation, maintained that only the complete withdrawal of the tax would prevent the demonstration scheduled for next Tuesday, February 13.