Economists Ask For More Time For VAT Implmentation
Akosombo (E/R), - A seminar on the re-introduction of the Value Added Tax (VAT) has ended at Akosombo with a call on Parliament to thoroughly debate the proposed VAT bill before it is passed into law. The bill, which will form the framework within which national debate would be focused should also set the parameters for public education, said Mr Kwame Peprah, Minister of Finance, at the closing of the seminar. Mr Peprah said it is important that parliament should look critically at the issues and concerns raised in the proposed bill and sensitize public debate on the re-introduction of the VAT which is expected to increase government's revenue. He urged all stakeholders to take part in the debate and the public education campaign after parliament passes the law. The seminar, Mr Peprah said, marked the beginning of the debate on VAT and hoped "to get everybody involved in the VAT implementation without it being rolled back again." The VAT which is described by experts to be the most simple, fair and effective instrument for generating revenue and improving the tax system was first introduced in Ghana in March 1995. Three months after its introduction, however, it was withdrawn for lack of adequate public education, timing and multiple charging of the then 17.5 per cent rate resulting in price hikes. These problems, the Minister said, would be critically addressed by the government to remove the mystery of the VAT for its successful take-off in January, 1998. But, the seminar had its own reservations about the proposed date for re-introduction, the chargeable rate, the threshold and issues of exemptions. A consensus reached by the participants of the seminar, organised by the Association of Ghana Industries and sponsored by the Friedrich Naumann Foundation, wants the re-introduction of the VAT to be delayed into the third quarter of 1998.