The Ghanaian government is exploring options to address a significant revenue gap resulting from the abandonment of a proposed value-added tax (VAT) on electricity earlier this year. The move aims to secure additional funds following public resistance to the initial VAT implementation.
The government initially introduced the VAT on electricity at the start of the year as part of revenue measures outlined in an IMF deal. However, due to public backlash, the initiative was scrapped, leading to a revenue shortfall of approximately GH¢ 1.8 billion.
To mitigate this gap, the government is considering implementing a tax on the foreign incomes of resident Ghanaians who spend 183 days or more in the country. This measure aims to ensure compliance with existing tax policies and generate additional revenue to fill the shortfall.
The Ghana Revenue Authority (GRA) is spearheading efforts to enforce compliance with this tax measure. The GRA emphasizes that the tax targets resident Ghanaians, not Ghanaians living abroad. Implementation of this measure is underway, with the GRA actively mobilizing resources to notify affected individuals and enforce compliance.
In addition to the tax on foreign incomes, the government is providing a window for taxpayers to voluntarily disclose their income and have interest on their accounts waived. The GRA encourages individuals to take advantage of this opportunity before the implementation process progresses further.
Finance Minister Dr. Mohammed Amin Adam acknowledges the challenges faced by Ghanaians due to these fiscal measures. He urges citizens to bear with the government as it introduces new strategies to restore economic stability and address revenue shortfalls.