Finance Minister Ken Ofori-Atta has issued a directive instructing the Ghana Revenue Authority (GRA) to collaborate with the Electricity Company of Ghana (ECG) and the Northern Electricity Distribution Company (NEDCO) in implementing a value-added tax (VAT) on residential customers exceeding specified lifeline power consumption beginning January 1, 2024.
According to the instructions, the GRA is assigned the responsibility of overseeing the implementation of VAT, as outlined in Act 870, Sections 35 and 37, and the First Schedule (9). This move is aimed at regulating and applying VAT to residential customers who surpass the designated lifeline power consumption.
Ken Ofori-Atta Issues Communique: VAT on Electricity
Communique from Government – VAT on Electricity
Furthermore, the GRA is mandated to work closely with ECG and NEDCO to facilitate the smooth transfer of collected revenues as part of domestic VAT collections. This collaborative effort seeks to ensure effective and efficient enforcement of VAT on residential customers exceeding the prescribed maximum consumption level for lifeline units.
The release issued by Minister Ofori-Atta emphasizes the need for ECG and NEDCO to actively engage with the GRA to ensure the seamless implementation of VAT for residential customers above the specified maximum consumption level, aligning with the provisions of Act 870.
