The Electricity Company of Ghana (ECG) has noted that it has not yet implemented the Value-Added Tax (VAT) on residential electricity consumption exceeding lifeline units.
The Finance Minister, Ken Ofori Atta, in a letter dated December 12, 2023 directed the ECG and the Northern Electricity Distribution Company (NEDCO) to liaise with the Ghana Revenue Authority (GRA) to implement VAT for residential customers of electricity above the maximum consumption level specified for block charges for lifeline units.
The implementation was scheduled to take effect on January 1, 2024, in line with Sections 35 and 37, and the First Schedule (9) of the Value Added Tax (VAT) Act, 2013 (ACT 870).
However, the ECG says the order is not yet in force.
In a notice on Monday, the company said, “The Electricity Company of Ghana (ECG) Limited wishes to inform our cherished customers and the general public that the Value Added Tax (VAT) on residential electricity consumption above the lifeline category has not been implemented. All stakeholders should please take note.”
Consumers have kicked against the announced measure, noting it will astronomically hike their charges and impact businesses as well as increase the cost of living in the country but the Ministry of Finance insists it is in accordance with the government’s medium-term strategy and IMF-Supported Post-COVID-19 Programme.