The government has officially suspended the Value Added Tax on Electricity.
This notice was issued by the Ministry of Finance (MoF) directing the Electricity Company of Ghana (ECG) and the Northern Electricity Distribution Company to suspend the implementation of the earlier directive.
The statement reads,
‘’Accra, Wednesday, 7th February, 2024… Reference is made to the Ministry of Finance’s (MoF) letter to the Electricity Company of Ghana, Ltd (ECG) and the Northern Electricity Distribution Company (NEDCO) on the above subject dated 12th December 2023; as well as MoF’s Press Statement on the subject issued on 30th January 2024.
2. 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.
3. The Ministry expects that these engagements will birth innovative, robust, and inclusive approaches to bridging the existing fiscal gap, while bolstering economic resilience’’.
The VAT on electricity resulted in a public outburst especially among the labour front which led the Organised labour to embark on an unprecedented demonstration to express their displeasure on the new tax.
The government, upon broader consultation, has resolved to suspend the implantation while they explore other avenues.
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