Telcos still deducting CST upfront to face sanction – Ursula
Communication minister, Ursula Owusu-Ekuful is warning that telecommunication companies who are still deducting the communication service tax upfront will be sanctioned.
It comes days after government ordered the telcos to immediately halt the upfront deductions of the CST.
Several mobile phone users had expressed their disquiet about the deductions which prompted government to take these measures.
The measures according to the sector minister is to this is to minimize the negative impact of the current mode of deduction of the CST.
Addressing the media in Accra on Monday, Madam Owusu-Ekuful said appropriate sanctions will be applied to telcos who flout government’s directive.
“from the 4th of September to date, they had been deducting this tax upfront. We say it is an irregular way of deducting taxes because it flies against industry practice. And so they should reconfigure their systems to treat it the same way they treat other taxes and levies that they’re required to collect and pass on to the tax authorities. I don’t see how this can be an illegal directive… the regulator will have a conversation with the telcos on that and if they persist, the requisite sanctions will be applied. If they want to continue doing business in this country, they will respect our laws”.
She further stressed that:
“all of them are multi-nationals. They operate in other jurisdictions. They know better than to flout the laws of the jurisdictions in which they operate as there’re sanctions attached to it. We’ve had an extremely cordial relationship with them. We’ve worked with them to resolve many challenges and are ready to assist them to navigate through this space as well but we will not countenance this imposition of untold, unwarranted suffering on the people of Ghana”.
Approach
A tax lawyer, William Kofi Owusu Demitia says the directive from the communication ministry is not best approach. In an interview monitored by The Ghana Report, Mr Demitia said the telcos are not flouting any law.
“from my perspective, what the telcos are doing is not wrong. They’re not flouting any law. It might be out of courtesy and respect for the minister and the ministry that they may revert to the system where they actually compute it as and when the actual usage takes place. The issue of the directive is not the best approach to adopt… The directives are helpful but I don’t think that is the best approach to resolve the actual issue which is the impact of the CST on consumers.i will admonish the ministry to further engage the telcos so that we can have a peaceful resolution” Mr Demitia said.