Government is proposing to Parliament the withdrawal of the luxury vehicle tax introduced in 2018.
While presenting the 2019 mid-year budget review in Parliament on Monday, the Finance Minister, Ken Ofori-Atta said government is taking such move following the concerns raised over the tax.
“Government in 2018 introduced the Luxury Vehicles Levy to raise revenue. We have noted suggestion from the general public on the implementation of this tax and Mr Speaker, as a listening Government, we are proposing to the House the withdrawal of the levy. We will continue to improve compliance, expand the tax net and explore other innovative sources of raising revenue,” he said.
Earlier this month, the Minority in Parliament demanded the removal of the luxury vehicle tax which it deems as “economically inefficient.”
The Minority insisted that the government had caused hardship for many Ghanaians through the “back door” with regards to the 5% increment in VAT.
“It is the expectation of the people of Ghana, that such subterfuge and shenanigan will not be repeated…Ghanaians expect the outright withdrawal/removal of the economically inefficient luxury vehicle tax,” the Minority said in a statement.
The levy was introduced during the 2018 midyear budget review, which took effect in August 2018 despite opposition from various groups.
Giving its expectation of the review, the Minority in a statement signed by Ranking Member on Parliament’s Finance Committee, Cassiel Ato Forson said: “Ghanaians are expecting a realistic Mid-year Budget that will address the hardships they are currently facing and not the announcement of populist, vote-buying gimmicks.”
The presentation of the mid-year budget review is in line with Section 28 of the Public Financial Management Act, 2016 (Act 921).