Kofi Kapito, the Chief Executive Officer (CEO) of the Consumer Protection Agency, has criticized the government’s decision to implement a Value Added Tax (VAT) on residential electricity customers who consume above the lifeline units.
He referred to this as an unfair taking of people’s money.
The VAT was announced by the Ministry of Finance in a letter to the Electricity Company of Ghana (ECG) and the Northern Electricity Distribution Company (NEDCO).
This tax, which started on January 1, 2024, is part of the government’s Covid-19 recovery program.
However, Kapito questioned the rationale behind taxing residential consumers for their electricity usage during an interview on the Citi Breakfast Show on Citi FM.
He suggested that it would be more reasonable to impose the VAT on manufacturers and companies that use electricity for profit.
“This is a ridiculous stealing of the people’s money. It is called a VAT. If a manufacturer, if a company that uses electricity to make a profit is asked to pay tax on it because the government needs the revenue, I am for it. Even as we speak, consumers are buying things like milk and other items from various stores; you go to restaurants, you pay taxes, you pay VAT on them.”
“So why does this government come and tell the consumer that because you are using the electricity for yourself, I should pay? What value is the consumer or the resident electricity user adding to the power that he is getting?” he stated.
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