The Trades Union Congress (TUC) has termed the 15% Value Added Tax (VAT) levied on energy use over the lifeline as a simple approach for the government to obtain income that is unjust to customers.
At a news conference on Tuesday, January 23, the TUC issued the government a seven-day deadline to withdraw the tax, noting its negative impact on ordinary Ghanaians’ livelihoods, particularly retirees and low-income workers.
In an interview with Eyewitness News on Citi FM, TUC deputy General Secretary Joshua Ansah warned that if the government does not remove the tax, organized labour will counsel itself and take action.
He informed Nana Tuffuor Boateng that the government does not have to rely solely on VAT to settle the energy sector debt and stabilize the country’s electricity supply.
“Organized labour will advise itself, and unions will do what unions often do when an unpopular decision or tax is introduced that affects workers.”
“VAT is not the only thing the government can do to bring back the lights. I don’t think that is the only way the government can take to make the electricity supply stable when a lot of the population is suffering. This is not fair, and that is why workers are resisting it with all their might.”
“If you are bringing additional taxes or VAT, then it is an easy way for the government. There are other ways the government can use to raise revenue, and it must work harder. To be burdening workers every day is not fair,” Mr. Ansah added.
In a letter dated January 1, Finance Minister Ken Ofori-Atta authorized the Electricity Company of Ghana (ECG) and the Northern Electricity Distribution Company (NEDCO) to apply the VAT in order to generate income for the COVID-19 recovery program.