Ghana suspends new power tax

Ghana’s government has suspended plans to implement a 15% tax on power, following a public uproar that it will worsen the cost-of-living crisis.

The value-added tax (VAT) was to be levied on domestic consumers of electricity.

But labour unions opposed the new tax and announced nationwide protests against it next week.

Authorities now say the plan has been put on hold until talks are held to resolve the dispute.

It comes a few days after the government started to implement a fuel emissions levy, sparking mixed reactions.

Ghanaians are now required to pay an annual levy for the carbon emissions produced by their petrol or diesel-powered vehicles.

Critics fear that the additional taxes could have a ripple effect on the struggling economy, further intensifying the cost-of-living crisis that has already pushed up the prices of necessities like fuel.

In a statement on Wednesday, the finance ministry directed the two main power distributors – Electricity Company of Ghana (ECG) and the Northern Electricity Distribution Company (NEDCO) – to put the new levy on hold.