Beginning today (1st November, 2018), Ghanaians are expected to start paying more for the services rendered by telcos operating in the country.
The telcos, Airtel-Tigo, MTN and Vodafone, earlier announced they are adjusting their tariffs upwards due to the VAT recalibration announced in the Mid Year Budget Review.
The government as part of the budget review in July separated the National Health Insurance Fund Levy and the GETFund component from the old 17.5% Value Added Tax (VAT) regime, thereby making the two components straight levies of 2.5 percent each.
Defending the decision by the Telcos earlier to Citi Business News, the CEO of the Ghana telecommunications Chamber, Ken Ashigbey said its members— Airtel-Tigo, MTN and Vodafone have no option than to pass on the impact of the newly recalibrated VAT, NHIL and GETFUND regime to consumers in order to stay competitive.
“The Telcos are just applying the law as was passed in August. Basically what is happening is that as intended the impact of those two levies will thus be on the consumer and will evolve to an increase in cost of telecommunication service,” he said.
Mr. Ashigbey argued that “this is an industry that pays close to 40 percent of its turnover to the government in terms of taxes of one form or the other, levies and fees that are paid. So, the industry is already a high taxed one”.
He maintained that telcos must adjust their operations to be competitive.
“We need to be able to be competitive as a business to be able to do business to attract the capital that we require, the investment that we require to even be able to expand your services to the underserved and unserved communities. So it is a balancing act and you need to ensure at the end of the day the sustainability of the industry and also, we are able to contribute to the development of this country as an industry”.
Citinewsroom