The government will in the coming weeks hold  “extensive dialogue” with Organised Labour and other key stakeholders to ensure buy-in for the introduction of 15% Value Added Tax (VAT) on electricity.

This followed agitation by stakeholder groups including the Labour Unions over the policy that seeks to tax the consumption of electricity by residential customers.

A statement from the Ministry of Finance appealed to Organised Labour and all stakeholders, including ECG and NEDCO, to exercise restraint to facilitate a constructive dialogue towards a quick resolution of the impasse.

The statement noted that government was committed to working with all stakeholders to

sustain economic gains and engender macroeconomic stability and inclusive growth in the country.

“We note the progress the country is making in the implementation of the Post COVID-19 Programme for Economic Growth (PC-PEG), including posting higher than programmed growth targets, declining inflation, improvement in fiscal and external positions, a more stable exchange rate, and the declining Monetary Policy Rate,” the statement said.

The Ministry of Finance in letter dated 12 December 2023 instructed the Electricity Company of Ghana (ECG) and the Northern Electricity Distribution Company (NEDCO) to in January this year apply the VAT to residential customers exceeding the maximum consumption level for lifeline units.

In its response, the Organised Labour through the Trade Union Congress, on January 23, gave government a seven-day ultimatum to withdraw the policy.

It critcised the timing for the policy which it said would worsen the economic conditions of Ghanaians.

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