2023 Budget: VAT Rate To Increase by 2.5% in 2023

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Government aims to cut imports by 50%

VAT Rate To Increase by 2.5% in 2023.

As part of attempts to get the economy back on track, the government has raised the value-added tax (VAT) from 12.5 percent to 15 percent.

The 2.5 percent increment is to directly support the roads sector and the government’s digitalization agenda.

The Finance Minister, Ken Ofori-Atta, announced in Parliament on Thursday during the presentation of the 2023 Budget Statement and Economic Policy of the Government.

Among a slew of measures aimed at resetting the economy is a review of the E-Levy Act, which will reduce the headline rate from 1.5% to 1% of the transaction value and eliminate the daily threshold.

Resource measures – 2023 budget

63. Mr. Speaker, Government has consistently indicated its intention to improve the revenue collection effort by leveraging technology to enhance tax administration, identify and register taxable persons and improve tax compliance.

64. Mr. Speaker, Government has received several proposals for review of the Electronic Transfer Levy and is working closely with all stakeholders to evaluate the impact of the Levy in order to decide on the next line of action which will include revision of the various exclusions. As a first step, however, the headline rate will be reduced to one percent (1%) of the transaction value alongside the removal of the daily threshold.

65. To this end, the income tax regime will undergo reforms to among others, review the upper limits for vehicle benefits and introduce an additional income tax bracket of 35%.

Check Also: Full text of Government Of Ghana’s 2023 budget statement

See also  2023 Budget : E-Levy Reduced To 1% from 1.5%, Affects All Transaction

VAT Rate To Increase by 2.5% in 2023.

 

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