Budget Blues: Government Increases Conversation Tax and Withdraws Tax on Luxury Vehicles

By Edzorna Francis Mensah

The government is seeking Parliament's approval to increase the tax on communication services, known as the "conversation tax," by 3% when the Minister of Finance has submitted for approval the revenue measures of the province. mid-year 2019.
Law 754 of 2008 on the tax on communication services (CST), introduced in 2008 at an ad valorem rate of 6%.

The tax is levied on royalties owed by consumers for the use of communication services.

But the government intends to increase revenues for the second half of the year ending December 31, 2019. The government has proposed to Parliament to raise the tax to 9% in order to throw the basics of creating a viable technological ecosystem in the country.
The Finance Minister said: "This will involve, among other things, setting up systems for identifying and combating cybercrime, protecting users of information technologies and combating money laundering. money and other financial crimes. "

The increase, said the minister, will not be affected, "however, the sharing ratio will be adjusted so that national youth employment programs continue to receive the same proportions as in the past." ; aujourd & # 39; hui ".
In the meantime, the tax on luxury vehicles has been examined.

In 2018, the government introduced the luxury vehicle tax to generate revenue, but "we have taken note of suggestions from the general public on the implementation of this tax and, Mr. President, as a government to listening, we propose to the House the withdrawal of the tax. ".

According to Ken Ofori Atta, "revenue-related measures, including the sale of an electromagnetic spectrum, the renewal of telecommunication licenses, the gains that may result from the realization of badets and mining rights, as well as the strengthening of compliance in ports and others, are actively pursued to ensure: the revised domestic revenue target for 2019, which is lower by about 8.3 million GH to the initial budget projection, n & # Is not compromised ".
As part of the Government's commitment to ensure that the 2019 budget is implemented as planned, the following additional revenue measures are proposed for the consideration and approval of the Honorable Members: energy – the Energy Sector Royalty Act, 2015 (Law 899) is restructured, streamlined and consolidated all energy sector revenue laws into one law, one upward adjustment of the road fund levy, the collection of energy debt recovery; and the price stabilization and recovery tax aimed at reducing the ratios to almost twenty-one percent (21%) in order to meet financing needs.