June 18, 2024
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We will not support 2.5 % increase in VAT rate – Minority

Minority Leader, Haruna Iddrisu has bemoaned the introduction of a 2.5 % Value Added Tax (VAT) rate in the 2023 Budget.

Addressing the press on Monday, he described the hike in VAT rate as punitive.

“The most punitive amount is the addition of 2.5% VAT which may result in accumulated VAT for Ghana standing at 21.5%,” he said.

He added that “Instead of cutting down on non-essential expenditure, we have rather seen an increase with additional spending of GHC82billion. Some of the envisaged expenditure items are entirely wasteful and needless and we demand a cut.”

It would be recalled that during the presentation of the 2023 Budget in Parliament, the Finance Minister, Ken Ofori-Atta announced government’s decision to increase the VAT by 2.5 percent.

Mr. Ofori-Atta explained that the review is to directly support road construction projects and the digitization agenda.

But Mr. Haruna Iddrisu has insisted that the Minority will not accept the 2.5% VAT rate.

The Tamale South MP questioned the moral right President Akufo-Addo has to increase the VAT rate.

This, he explained, is because President Akufo-Addo protested the introduction of VAT under the NDC-led administration.

“In 1995, when the NDC sought to introduce this tax, they [NPP] organised what was referred to as ‘Kume preko’ resulting in loss of lives of five persons. Where is principle in our body politic? And where do they stand when it comes to morality?” he quizzed.

According to him, whatever revenue that would be accumulated from the 2.5% VAT rate can be achieved by the government cutting its expenditure.

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