Consumers to lose talk time value – Telecoms Chamber

Mr Kenneth Ashigbey, CEO, Telecoms Chamber

Consumers of telecommunications services will lose about 22 pesewas of every GHc1 talk time they buy due to the proposed increment in the Communications Service Tax (CST).

Currently, telephone service consumers such as mobile phone users spend about 19.09 pesewas out of every GH¢1 worth of airtime on taxes, the Chamber of Telecommunications has revealed.

The increment follows the proposed increase of the CST from six per cent to nine per cent expected in force when the President assents to the Appropriation Bill approved by Parliament okaying supplementary spending of more than GHc6.3 billion.

Already, players in the telecommunications industry are complaining of being burdened as they spend nearly 40 percent of their revenues on taxes, levies and regulatory fees, among others.

The CST, a consumer tax, will therefore be passed on to the consumer which possibly may lead to retrenchments in the communication services sector, he said.

The Chief Executive Officer of the Ghana Chamber of Telecommunications, Mr Kenneth Ashigbey, cautioned against the ‘over taxation’ of the telecommunications industry, adding that it did not augur well for the country.

“These industry-specific taxations are one of the things that we will wish that government will stop and if there will be any taxation, it should be taxation that will be across the board, especially when you consider the fact we are paying close to 40 per cent in terms of taxes, levies, regulatory fees and all of that,” he said.

Talk tax as many Ghanaians call it was introduced in 2008 by the government at an ad valorem rate of six per cent.

The tax is levied on charges payable by consumers for the use of communication services.

Last year, the tax gathered a total of GHc420 million, representing a 27.7 percent increase from the estimated GHc304 million accrued in 2017.

The Minister of Finance, Mr Ken Ofori-Atta, on Monday, July 29, 2019, announced an increment in the CST from six per cent to nine per cent in Parliament.

Presenting the Mid-Year Fiscal Policy Review of the 2019 Budget Statement and Economic Policy and Supplementary Estimates of the Government of Ghana for the 2019 Financial Year, Mr Ofori-Atta explained that the increment was aimed at creating a viable technology ecosystem to, among others, identify and combat cybercrime.