COVID-19 Levy not for 2020 free water and electricity – Gov’t
The government has refuted claims that it intends to use revenue from the COVID-19 Levy to pay for the free water and electricity enjoyed by Ghanaians in 2020.
At a press briefing on Sunday, March 21, Information Minister, Kojo Oppong Nkrumah clarified that the purpose of the COVID-19 Levy has been outlined in the budget and it does not include free water and electricity.
“You know that the government has never said that you have to pay for the free water and electricity,” he reiterated pointing to page 58 of the budget.
Mr Oppong Nkrumah explained that the Ministry of Finance had issued a statement which details the purpose of the levy.
According to the statement, the free water and electricity of 2020 “ought not to be misconstrued to mean the new taxes of 2021 are a direct charge for those services.”
Mr Oppong Nkrumah said the introduction of taxes was not a measure unique to Ghana but other such as the United Kingdom, the United States of America, Saudi Arabia and Indonesia.
“For example, the UK is hiking corporate tax to about 25% to support their response programme. In Indonesia, they’ve done a 10% VAT on sales by technology firms. And then in Argentina, they’ve passed a new tax on the wealthiest people to pay for medical supplies and relief measures.
“In Saudi Arabia, they are considering tripling their Value Added Tax as part of austerity measures following the COVID response programme. In the US, they are considering some of the major hikes since 1993. So we are not alone in this situation,” he said to buttress his point.
Ghana’s COVID-19 update
According to the Information Minister, active cases declined from over 8,000 to less than 3,500 over the past 4 weeks.
Daily reported cases have declined from 800 cases to about 250 over the past 4 weeks and more than 450,000 persons have had 1st dose of vaccination.
A total of 89,682 cases have been detected after 970,048 tests were conducted.
So far 85,761 people have been discharged or recovered while 725 patients have perished.
Total active cases are currently at 3,196.
The 2021 Budget presented to parliament captures several taxes including a COVID-19 Levy which comprises a 1 per cent levy on Value Added Tax (VAT) and 1 per cent rise in the National Health Insurance Levy (NHIL).
The pandemic resulted in a revenue shortfall of GHC19billion and the new taxes form part of programmes to generate domestic revenue towards growth.
In justifying those taxes, Mr Oppong Nkrumah had said that the government needed to cover the cost of fighting the pandemic.