The Finance Minister-designate, Ken Ofori-Atta, has justified the proposed new taxes in the 2021 budget.
Osei Kyei-Mensah-Bonsu, the caretaker Finance Minister, while delivering this year’s budget statement announced moves to impose taxes on fuel, i.e. 10 pesewas per litre for diesel and petrol as Sanitation and Pollution Levy (SPL) and 20 pesewas per litre of petrol and diesel to be used as Energy Sector Recovery Levy to cover charges on the State for excess capacity of power.
He also announced the introduction of other taxes such as a COVID-19 health levy of one percent of VAT, and a financial sector clean up levy of five percent on profit-before-tax of banks.
Though these soon-to-be-implemented taxes have not been received well by Ghanaians, the government believes these taxes will aid the country’s recovery from the effects of the COVID-19 pandemic.
Mr. Ofori-Atta, in a virtual post-budget forum by PricewaterhouseCoopers, said “If you look at the taxes, we do have issues of Sanitation and the Delta fund for energy and those have to be tackled. So the petroleum taxes are supposed to help contribute towards that. Then we have the one percent of VAT which essentially is looking at making sure that we are able to pay for the vaccines and get our people working, so we don’t have lockdowns and so that our infrastructure for healthcare will be a lot more robust.”
“Our financial sector also has attacks. All of these associations somehow have an impact on revenue collection. There has to be a collective responsibility on that. We have seen the robustness of the sector over the past three or four years, and therefore I’m roping them in on their part as a shared burden philosophy in terms of the way forward,” he continued.