FINANCIAL INSTITUTIONS TO STOP CHARGING 17.5% VAT ON SERVICES

The NPP government has with immediate effect, through the Ghana Revenue Authority (GRA) abolished the Value Added Tax (VAT) charged on all financial service transactions in the country.

GRA in a letter, citied by the thebftonline.com, has directed all financial institutions to cease charging the VAT on financial services as the law backing tax has been repealed.

The statement which was signed by the Commissioner General of the GRA, Emmanuel Kofi Nti stated that “To give legal effect to the policy on VAT on Financial services, Parliament passed the Value Added Tax (Amendment), Act 2017, Act 948 to include the supply of the financial services as exempt supply”.

The letter further stated that, “in line with the above, we hereby inform all financial institutions to discontinue charging VAT on financial services.”

The Minister of Finance, Ken Ofori-Atta in presenting the 2017 Budget statement presented to parliament, announced that the NPP government had abolished the 17.5% VAT/NHIL being charged on financial services.

The business community in Ghana will heave a sigh of relief, following government’s announcement of the repeal of this tax which was among a list of taxes are being abolished, while others have been reviewed.

The cancellation of the taxes, most of which affects businesses, according to the government, are aimed at providing a friendly environment for businesses in the country.

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