NPP will drop senseless financial service tax, other nuisance taxes – Bawumia

Dr. Mahamudu Bawumia
Dr. Mahamudu Bawumia

The New Patriotic Party would do away with the financial service tax and other taxes it considers “nuisance” if voted into power, its vice presidential candidate Dr. Mahamudu Bawumia has announced.

The economist is convinced the move would ensure that the country’s economy is robust and conducive for businesses to thrive.

“Nana Akufo-Addo’s government will put together the most business friendly, the most people friendly economy on this continent,” Dr. Bawumia promised.

VAT on fee-based financial services was introduced in 2014 but took effect from January 2015. Services such as payment order, overdraft processing, arrangement fee for facilities, statements and certificates of balance attract 17.5% tax under VAT Act 2013 (Act 870).

But Dr. Bawumia told Accra-based Citi FM on Friday there is no wisdom in taxing these financial services.

“Corporate taxes, we want to bring down for sure, the capital gain taxes is too high, the tax on financial services doesn’t make sense, the tax on bringing solar panels into Ghana doesn’t make sense when we want to solve an energy problem. We are going to take away what we called some of these nuisance taxes,” he emphasised.

The NPP is on record to have vehemently opposed the Value Added Tax when it was introduced by the Rawlings administration in 1995 which led to the fatal ‘Kumi preko’ demonstration.

The party who felt the tax was going to worsen the wobbling economic situation at the time promised to reduce the tax, but it ended up increasing it when the party gained power.

Nonetheless, Dr. Mahamudu Bawumia is cocksure the NPP would not pay lip service to taxes it want reduced or withdrawn.

“Some of them we are going to repeal all together, the VAT on financial services has to go, there is no reason why we should be taxing import duty on solar panels and raw materials for example. We will take them out …to give the private more incentives to produce,” he pointed out.

Dr. Bawumia who is a former Deputy Governor at the Bank of Ghana also implored government to give tax incentives to local companies just as it gives to foreign ones to increase production.


Story by Isaac Essel | | Ghana

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