Unexpected Increase in the Conversation Tax – Ken Ashigbey

Company News on Tuesday, July 30, 2019

Source: citinewsroom.com

2019-07-30

Ken Ashigbey, General Manager of Ghana's Chamber of Telecommunications, described the government's decision to raise the tax on communication services as a surprise from 6% to 9%.

According to Mr. Ashigbey, unlike the previous situation, no extensive consultation took place before such a decision was made.

"What happened to this government, is that before the budget reading or the mid-term budget review, there is normally a commitment." There is a forum called the Tax Dialogue where the Ministry of Finance, GRA and the tax advisers, we all sit together [to hold consultations]. It had not happened before this mid-year review, which was a surprise for us. We did not expect the communication fee to increase.

The minister, in justifying the need for the increase, said it was to create a viable technology ecosystem in the country.

The government proposes to increase the tax to nine percent in order to lay the foundation for creating a viable technology ecosystem in the country. This will include, among other things, the establishment of systems for the identification and fight against cybercrime, the protection of users of information technologies and the fight against money laundering and corruption. 39, other financial crimes. The increase will not be affected, but the sharing ratio will be adjusted so that national youth employment programs continue to receive the same proportions as today, said the minister.

The tax introduced in 2008 is levied on the use of communication services in the country, including voice calls.

Data from the Ministry of Finance showed that in 2018, the government had fired 420 million GH of the tax.

This amount represents an increase of 27.7% over what the state had acquired in 2017.

"Increment is a lazy approach" – Kofi Kapito

Meanwhile, the director general of the Consumer Protection Agency, Kofi Kapito, has expressed reservations about this increase, describing it as a lazy approach.

"This is a sad day for Ghanaian consumers, especially telecom consumers and consumers affected by the new tax and fuel. We are talking about expanding the digital age, so it should be affordable rather than expensive. "

"Last year, it appeared that in terms of data, Ghana stood out as one of the most expensive data countries in the world. How are we going to catch up with the rest of the world? I think it's a lazy approach … There are many ways for the government to maximize taxes to increase revenues, "he said.