Reduction in ‘Talk tax’ to take effect in September 2020 – Akufo-Addo
The government says the implementation of the new rate for the Communication Service Tax also known as talk tax is to begin effective September 2020.
Finance Minister, Ken Ofori-Atta during the presentation of the 2020 mid-year budget review announced that the talk tax has been reduced from 9 percent to 5 percent.
“In the short term, we will reduce the CST from 9% to 5% to reduce the cost of communication services to the consumer as more and more people work remotely and utilize online services. We will count on the Telcos to match this reduction in the CST by reducing their tariffs. This is important for our youth, entrepreneurs, and the burgeoning FINTEC industry,” he said.
Addressing Ghanaians on Sunday, July 26, 2020, to reiterate plans taken by the government to cushion Ghanaians from the impact of COVID-19, Nana Akufo-Addo indicated that the move will be rolled out in September.
“The Communication Service Tax has also been reduced from 9 per cent to 5 per cent, effective September 2020.”
Communication Service Tax and its journey so far
The Akufo-Addo government in 2019 increased the communication service tax from 6% to 9% over what it says was to create a viable technology ecosystem in the country.
Following the implementation of the CST, the Communications Ministry accused the mobile telecommunications companies of milking consumers over their upfront charging of the tax.
The Minister for Communications, Ursula Owusu-Ekuful at the time also demanded that all unused data and voice bundles purchased by subscribers to be immediately rolled over upon the next recharge.
Others rather accused the Ministry of Communication of extortion in the directive to telcos to cease the instant deduction of the Communications Service Tax (CST).
The Telcos were subsequently directed to stop the upfront deduction of the tax.
The tax which was introduced in 2008 is charged on the use of communication services in the country including voice calls.