Value-added tax (VAT) collected from customers who have exceeded their lifeline electricity consumption would be transferred to the two power distribution firms, per a request made by the government to the Ghana Revenue Authority (GRA).
Ken Ofori-Atta, the finance minister, issued a press release directing the Electricity Company of Ghana (ECG) and the Northern Electricity Distribution Company (NEDCO) to collaborate with GRA in order to impose Value Added Tax (VAT) on households that have exceeded the maximum consumption threshold for block charges for lifeline units, starting on January 1, 2024.
“The Electricity Company of Ghana (ECG) and the Northern Electricity Distribution Company (NEDCO) are hereby requested to liaise with the Ghana Revenue Authority (GRA) to ensure that the implementation of VAT for residential customers of electricity above the maximum consumption level specified for block charges for lifeline units takes effect on January 1, 2024, in line with Sections 35 and 37 and the First Schedule (9) of Act 870.
“By a copy of this letter, GRA is requested to ensure that it liaises with ECG and NEDCO for the transfer of the revenues collected from the implementation of VAT on the subject matter as part of its domestic VAT collections,” the December 12 release read.
