An energy expert, Kwadwo Nsafoah Poku, has questioned the government's timing for the introduction and implementation of Value Added Tax (VAT) on electricity supply.

A statement signed by the Minister of Finance, Ken Ofori-Atta, said the implementation forms part of the government’s medium-term revenue strategy and the IMF-supported post-COVID-19 programme.

It added that the VAT will be charged in line with Sections 35 and 37 and the First Schedule (9) of the Value Added Tax (VAT) Act, 2013 (ACT 870) with effect from January 1, 2024.

Reacting to the announcement, Kwadwo Poku described the timing of the move as not ideal, especially at the beginning of the year.

He, however, explained that taxes were necessary for the country’s energy situation which has been in a difficult place for some time.

“I think the timing is wrong. It is a wrong time to introduce more VAT on electricity at this stage,” he told Accra-based Joy FM.

He, therefore, called on the relevant authorities to at least reconsider the date for the implementation of VAT on electricity supply.

The energy expert also urged for sensitisation around the VAT introduction on electricity supply while calling for an update of ECG’s operating software.

Meanwhile, the government, through the Ministry of Finance, has directed Ghana Revenue Authority (GRA) to collaborate with the Electricity Company of Ghana (ECG) and the Northern Electricity Distribution Company (NEDCO) to implement VAT on households that exceed the lifeline power consumption.

MA/AE

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