A Look at Key Taxes Introduced by NPP Government (2017-2024)
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Between 2017 and 2024, under the leadership of President Nana Addo Dankwa Akufo-Addo, the New Patriotic Party (NPP) government in Ghana introduced a slew of taxes aimed at enhancing the country’s revenue generation capabilities.
The new taxes introduced by NPP government within the period of 6 years is a reflection of a concerted effort to not only achieve economic sustainability but also to ensure the provision of essential public services. While these measures have sparked considerable debate among stakeholders, it is crucial to recognize the government’s intention to foster a sustainable and resilient economy.
The success of these taxes introduced by the NPP government hinges on the government’s ability to communicate effectively, maintain transparency, and foster collaboration with its citizens. This exploration by GhanaEducation.org into the key taxes introduced offers insight into the government’s strategy for economic management in Ghana.
full Details of Key Taxes Introduced by The NPP Government between 2017-2024
A standout among the new tax measures is the Electronic Transaction Levy, or E-Levy, designed to tap into the burgeoning digital economy. By levying a small percentage on electronic transactions, including mobile money transfers and e-commerce, the E-Levy aims to widen the tax base and ensure equitable contribution from the digital sector towards national development.
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In a move to promote environmental sustainability, the NPP government introduced the Emissions Levy targeting vehicles based on their engine capacity, encouraging the adoption of eco-friendly technology and green energy. Similarly, the government has introduced a 10% tax on betting and lottery winnings, with the Ghana Revenue Authority (GRA) ensuring compliance through automatic deductions at the point of payout.
The VAT landscape saw adjustments with a 3% VAT flat rate introduced for VAT-registered retailers of taxable goods, aiming to simplify the tax calculation process for small businesses. Moreover, significant increases were implemented, including a 5% hike in VAT by transforming the GETFUND levy and NHIL into straight taxes, alongside a series of other levies affecting the financial, energy, and communications sectors.
Notably, the Luxury Vehicle Levy imposes an annual charge on vehicles with high engine capacities, collected upon registration and renewal of roadworthy certificates. The Communication Service Tax also saw a 50% increase, impacting consumers of electronic communication services.
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The introduction of the COVID-19 Health Recovery Levy on both the VAT flat rate and National Health insurance levy reflects the government’s response to the pandemic’s economic impact. Additionally, the financial sector and the energy sector faced new levies and taxes, including a financial sector clean-up recovery levy and adjustments to the Energy Sector Recovery Levy on diesel, petrol, and LPG.
Parliamentary enactments like the Excise Duty Amendment Bill 2022 and others have further revised taxation on individuals and businesses, indicating a comprehensive overhaul aimed at increasing revenue while addressing current economic challenges.
These fiscal measures, ranging from increased levies on fuel and luxury vehicles to new taxes on digital transactions and environmental emissions, underscore the NPP government’s strategic approach to taxation. As Ghana navigates its economic future, the effectiveness of these policies in achieving a balanced and inclusive growth trajectory remains a subject of keen observation and analysis.
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