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Govt’ abolishes ‘nuisance’ taxes: spare parts importation; 17.5% VAT on financial services etc

Government on Thursday made a loud statement in Parliament with the announcement of its decision to remove many “nuisance” taxes and duties on certain products that have militated against the development of the private sector.

Presenting the 2017 budget and economic policy statement to Parliament today, Finance Minister Ken Ofori-Atta said the 17.5 percent VAT/NHIL on financial services introduced by the erstwhile government would be abolished. Also, he said VAT on selected imported medicines that are not produced locally would be abolished as the government takes steps to abolish import duties on raw materials and machinery for production.

Mr. Ofori-Atta also said the government will remove tax on domestic airline tickets as well as abolishing 5 percent VAT/NHIL on real estate sales. Kayayei According to the Finance Minister, government will abolish excise duty on petroleum, reduce special petroleum tax rate from 17.5 percent to 15 percent.

 

Kayayei

Another pro-poor initiative captured in the budget is the abolishment of levies imposed on kayayei (head porters) by local authorities. Also the minister pointed out that, gains from the realization of securities listed on the Ghana Stock Exchange would b exempted from taxation.

Government is going to also reduce the National Electrification Scheme Levy from 5% to 3%, and the Public Lighting Levy would be reduced from 5% to 2%. Government has also decided to replace the 17.5 VAT/NHIL rate with a flat rate of 3 percent for traders, the minister enumerated.

With a growing unemployment rate, government intends to implement tax credits and other incentives for businesses that hire young graduates.

Source: 3news.com

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