In response to mounting public concern, the government has announced the suspension of the proposed 15% Value Added Tax (VAT) on domestic electricity consumption. The Ministry of Finance has directed both the Electricity Company of Ghana (ECG) and the Northern Electricity Distribution Company (NEDCO) to halt the imposition of the levy until further notice.
A press statement released by the Ministry of Finance on Wednesday emphasized the need for additional dialogue with key stakeholders, including Organised Labour, before proceeding with the VAT implementation.
“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 statement read.
The Ministry highlighted the expectation that these discussions would lead to innovative and inclusive solutions to address fiscal challenges while bolstering economic resilience.
Meanwhile, Organised Labour, which has vehemently opposed the VAT imposition, reiterated its stance, declaring that only a complete withdrawal of the tax would prevent the nationwide demonstration scheduled for next Tuesday, February 13.
The government’s decision to suspend the VAT on domestic electricity consumption reflects its responsiveness to public sentiment and its commitment to inclusive policy-making. As discussions continue with stakeholders, the nation awaits further developments on this matter of significant economic importance.