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Mid-year budget review: Luxury vehicle tax withdrawn

The Finance Minister, Ken Ofori-Atta, has announced government’s decision to withdraw the luxury vehicle tax after massive public outcry.

The luxury vehicle tax was introduced in 2018.

Ahead of the presentation, some Ghanaians including the Minority in Parliament have urged the government to scrap the luxury vehicle tax and also introduce policies to cushion Ghanaians from economic hardships.

Presenting the 2019 mid-year budget review in Parliament on Monday, the Finance Minister “Mr Speaker, as a listening Government, we are proposing to the House, the withdrawal of the levy.

“We will continue to improve compliance, expand the tax net and explore other innovative sources of raising revenue.”

The government in 2018 introduced the Luxury Vehicles Levy to raise revenue but it was massively rejected by the Ghanaian populace.

The Finance Minister also disclosed that government is increasing Communication Service Tax (CST) to nine per cent.

The move, according to him, was to develop the foundation for the creation of a viable technology ecosystem in the country.

“This will comprise amongst others putting in systems to identify and combat cybercrime, protect users of information technology and combat money laundering and other financial crimes,” he said on Monday.

“The increase will not be earmarked, however, the sharing ratio will be adjusted in such a manner that the national youth employment programmes continue to receive the same proportions as they are currently receiving,” he added.

The Communication Service Tax (CST) was introduced in 2008 at an ad valorem rate of six per cent. The tax is levied on charges payable by consumers for the use of communication services.

Mr. Ofori-Atta requested the legislature to approve an amount of GH¢6.7 billion being the shortfall in funds the government needs to execute its 2019 budget.

The government has faced a shortfall in domestic revenues and the amount is expected to go a long way in helping the government to complete its planned programmes and initiatives as contained in the 2019 financial year.

The Minister of Finance believes Ghana’s future generation will be grateful to the Akufo-Addo government for introducing the free Senior High School policy.

He said the free SHS programme, has changed the course of the nation forever, adding that “posterity will thank the President of the Republic of Ghana, His Excellency Nana Addo Dankwa Akufo-Addo for making it possible for our young people to realise their future dreams and aspirations through free education.”

According to him, access to secondary education in this country has never been higher and that . the innovative temporary double-track system currently being implemented has helped to accommodate the numbers, affording each child the possibility of accessing secondary education.

“Government has responded to this increased demand with accelerated infrastructure delivery,” he added.

BY: KOFI AGYIE//24NEWS.NEWS//GHANA

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