Govt to tax foreign incomes of resident Ghanaians to replace VAT on electricity

The Ghanaian government is exploring a tax on the foreign incomes of resident citizens to compensate for the revenue gap left by the shelved value-added tax (VAT) on electricity, a move prompted by public resistance earlier this year.

Initially introduced as part of revenue measures in the IMF deal, the VAT on electricity was scrapped following public outcry, leaving a

Read full articleshortfall of approximately GHc 1.8 billion.

The government's plan now hinges on ensuring compliance with the tax on foreign incomes, targeting resident Ghanaians who spend 183 days or more in the country.

While the IMF deal mandates certain expenditure rationalization and revenue measures for fiscal consolidation, the government aims to bridge the gap by enhancing compliance with the tax on foreign incomes.

According to the Commissioner-General of the Ghana Revenue Authority (GRA), efforts are underway to enforce this tax measure, with letters to individual account holders slated for dispatch by May 2nd. Taxpayers are encouraged to utilize the voluntary disclosure window to waive interest on their accounts.