17.5% VAT on financial services suspended

The Ghana Revenue Authority has put on hold plans to introduce the VAT on financial services from tomorrow.

It would have seen banks and other financial institutions charge 17.5 percent tax on some services rendered to the public. 

Some of the services that would be affected include closure of accounts, remote banking services including online banking, e-statements, phone banking, mobile banking, sale of cheque leaflet, replacement of lost cheque book among others.

But government has come under intense pressure from various quarters including banking institutions, unionised workers, to withdraw the 17.5 per cent VAT imposed on what it described as non-core financial services.

For instance, Chief Executive Officer of the Chartered Institute of Bankers (CIB), Ghana, Mr Anthony Yaw Oppong said Ghana’s unbanked population of about 70 per cent may be prevented from dealing with the banks in view of the directive.

But Joy Business has gathered a notice is expected to be issued today to announce the decision to suspend its introduction. It however unclear what might have influenced this decision.

In an unrelated development, contrary to earlier reports by some media, fuel prices would not go up at the pumps from tomorrow mainly because of the current shortage. The National Petroleum Authority should have reviewed the prices of the various petroleum products today in line with its adjustment every two weeks.

This could have seen the prices increase from July 1, but Joy Business has learnt prices of the products would remain unchanged.

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