Ghana jerks up fuel, energy, communication prices in mid year budget
London, July 30, 2019 (AltAfrica)-Ghana government has delivered a grim mid year budget review with increase on essential commodities that will practically worsen the plight of common man
Presenting the 2019 midyear budget review to Parliament on Monday, finance minister Mr. Ofori Atta announced that Ghanaians will have to pay GHp20 more for a litre of petrol and diesel and GHp 8 more for a kg of LPG
“Mr. Speaker, you may recall that Government in 2017 issued the Energy Sector Levy Act (ESLA) Bond, which has, to date, raised almost GHS 6 billion on the back of ESLA levies to pay for legacy debts from the NDC’s “dumsor days”.
“The bond proceeds were used to liquidate approximately 60% of the energy sector legacy debts. Government proposes to increase the Energy Sector Levies by GHp 20 per litre for petrol and diesel and GHp 8 per kg for LPG, so as to increase the inflows to enable Government issue additional bonds to pay down our energy sector debt obligations.
“Based on current indicative prices for petrol and diesel this translates to GHp 90 per gallon.”
In a similar vein, the government has increased the Communication Service Tax to nine per cent from the initial six per cent to” develop the foundation for the creation of a viable technology ecosystem in the country”
Mr Ofori-Atta told the lawmakers that: “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.
“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.
Another major highlights of the mid year budget review was scrapping of the Luxury Vehicles Levy introduced in 2018. Ofori-Atta said the government had considered agitations by the public and various bodies advocating the cancellation of the levy.
He told parliament that “as a listening government, we are proposing to the House, the withdrawal of the levy”.
Parliament passed the Luxury Vehicle Levy to impose an annual levy on vehicles with high engine capacities effective from Wednesday, 1 August 2018.
The levy was supposed to affect vehicles with engine capacity of two thousand, nine hundred and fifty (2950) Cubic Centimeters and more.
The levy was GHS1000 for vehicles with engine capacity of 2950cc – 3549cc, GHS1,500 for vehicles with engine capacity of 3550cc – 4049cc and GHS2,000 for vehicles with engine capacity of above 4049cc.