The Electricity Company of Ghana (ECG) has clarified that it has not yet enforced the Value-Added Tax (VAT) on residential electricity consumption exceeding lifeline units.
Despite a directive from Finance Minister Ken Ofori Atta on December 12, 2023, instructing ECG and Northern Electricity Distribution Company (NEDCO) to collaborate with the Ghana Revenue Authority (GRA) for VAT implementation, the company states that the order is not currently in effect.
Originally slated to commence on January 1, 2024, the implementation aligns with Sections 35 and 37, as well as the First Schedule (9) of the Value Added Tax (VAT) Act, 2013 (ACT 870).
In a notice issued on Monday, ECG stated, “The Value Added Tax (VAT) on residential electricity consumption above the lifeline category has not been implemented. All stakeholders should please take note.”
Despite consumer opposition, citing potential cost hikes and economic repercussions, the Ministry of Finance defends the measure, asserting its alignment with the government’s medium-term strategy and the IMF-Supported Post-COVID-19 Programme.